Questions 17 to 22 relate to the following information: Ferry Inc issued a $250,000 bond on March 1, 2020. The bond has a stated interest rate of 10%, matures on March 1, 2023 and pays interest on September 1 and March 1 of every year. The market interest rate was 12% when the bond was issued. Ferry Inc has a December 31 year end and uses the effective interest method to amortize bond discount or premium, and uses a discount or premium account. Present value factors for selected periods and interest rates are shown below. Periods 5% Present Value of $1 Present Value of Ordinary Annuity of $1 6% 10% 12% 5% 6% 10% 12% 0.8396 0.7513 0.7118 2.7232 2.6730 2.4869 2.4018 0.7050 0.5645 0.5066 5.0757 4.9173 4.3553 4.1114 3 0.8638 6 0.7462 The amount of cash received for the bond issue on March 1, 2020 is equal to: Select one: a. $250,000 b. $237.716 c. $61.466 O d. $262,686 The journal entry to record the issuance of bonds on March 1, 2020 should included a credit to: Select one: O a. Discount on bonds payable for $12,284 b. Bonds payable for $250,000 O c Premium on bonds payable for $12,686 d. Bonds payable for $262.284 Which of the following statements is TRUE? Select one: O a. Ferry Inc would record a discount on bonds payable at the issuance date O b. Ferry Inc would record interest expense at the issuance date. O c. The stated rate, or the coupon rate, is used to calculate interest expense on a bond O d. Ferry Inc would record a premium on bonds payable at the issuance date The interest expense that should be recorded on September 1, 2020 is Select one: O a. $12,500 O b. $14,263 O c. $13,134 O d. $28,526 The interest expense Ferry Inc would record on December 31, 2020 is Select one: O a. $9,579 b. $28,737 O c. $7,924 O d. $8,735 Total interest expense during the bond's life would equal Select one: O a. $75,000 O b. $87.284 O c. $90,000 O d. $77,314