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Rodgers Corporation produces and sells football equipment. On July 1, 20Y1, Rodgers issued $36,800,000 of 10-year, 11% bonds at a market (effective) interest rate of
Rodgers Corporation produces and sells football equipment. On July 1, 20Y1, Rodgers issued $36,800,000 of 10-year, 11% bonds at a market (effective) interest rate of 9%, receiving cash of $41,586,823.
Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year.
3. Determine the total interest expense for 20Y1. Round to the nearest dollar. 4. Will the bond proceeds always be greater than the face amount of the bonds when the contract rate is greater than the market rate of interest? answers to the nearest dollar. Your total may vary slightly from the price given due to rounding differences
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