On June 30, 2016, Singleton Computers issued 8% stated rate bonds with a face amount of $200 million. The bonds mature on June 30, 2031 (15 years). The market rate of interest for similar bond issues was 7% (3.5% semiannual rate). Interest is paid semiannually (4.0%) on June 30 and December 31, beginning on December 31, 2016. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Required:

1.

Determine the price of the bonds on June 30, 2016.

Table values are based on:
n =
i =
Cash Flow	Amount	Present Value
Interest
Principal
Price of bonds

2.

Calculate the interest expense Singleton reports in 2016 for these bonds using the effective interest method.

Period-End	Cash Interest Paid	Bond Interest Expense	Premium Amortization	Carrying Value
06/30/2016
12/31/2016			$0	0