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Use the following information to answer questions 4648 : Hugo Inc. raised $108,529.80 by issuing 5 -year bonds with a face value of $100,000 and
Use the following information to answer questions 4648 : Hugo Inc. raised $108,529.80 by issuing 5 -year bonds with a face value of $100,000 and a stated rate of 8%. The market rate of interest at the time was 6%. The coupon payment is paid semi-annually. The company uses the effective interest rate method. 46. How much interest expense was recorded with the first payment? A. $6,000 B. $4,341 C. $4,000 D. $3,256 E. $3,000 47. How much cash is paid for the first payment? A. $8,000 B. $6,000 C. $4,000 D. $3,256 E. $3,000 48. What was the carrying value of the bond after the second payment? A. $109,226 B. $107,019 C. $107,785 D. $105,464 E. $100,000
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