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Purple & Orange, Inc., sold $800,000 of bonds on an interest payment date at 102. Assume the bonds will be retired in 10 years and

Purple & Orange, Inc., sold $800,000 of bonds on an interest payment date at 102. Assume the bonds will be retired in 10 years and interest is paid annually. The bonds carry a stated interest rate of 6.5 percent. a. Calculate the amount of cash that will be received and paid by Purple & Orange in the first full year. b. Calculate the amount of interest expense that will be recognized in first year.

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