On January 1, Martinez Inc. issued $3,000,000, 11% bonds for $3,195,000. The market rate of interest for these bonds is 10%. Interest is payable annually on December 31. Martinez uses the effective-interest method of amortizing bond premium. At the end of the first year, Martinez should report bonds payable of: a. $3,185,130. b. $3,184,500. c. $3,173,550. d. $3,165,000.
On January 1, Martinez Inc. issued $3,000,000, 11% bonds for $3,195,000. The market rate of interest for these bonds is 10%. Interest is payable annually on December 31. Martinez uses the effective-interest method of amortizing bond premium. At the end of the first year, Martinez should report bonds payable of: a. $3,185,130. b. $3,184,500. c. $3,173,550. d. $3,165,000.
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 5EA: Diana Inc. issued $100,000 of its 9%, 5-year bonds for $96,149 when the market rate was 10%. The...
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On January 1, Martinez Inc. issued $3,000,000, 11% bonds for $3,195,000. The market rate of interest for these bonds is 10%. Interest is payable annually on December 31. Martinez uses the effective-interest method of amortizing bond premium. At the end of the first year, Martinez should report bonds payable of:
a. $3,185,130.
b. $3,184,500.
c. $3,173,550.
d. $3,165,000.
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