XYZ Corporation issues $1.000,000 of face value bonds that mature in 20 years at a discount on January 1. 2021 XYZ recelved a total of $960,000 on January 1, 2021. The contractual interest rate for the bonds is 6% and the market rate of interest at the date of issue is 7% Using the straight-line method, what is the total amount of interest expense, including amortization of the discount, that XYZ should recognize on December 31, 2021 when XYZ accrues the interest on the bonds for 2021? O $70,000. O $62.000. O $58.000. O $60,000.

XYZ Corporation issues $1.000,000 of face value bonds that mature in 20 years at a discount on January 1. 2021 XYZ recelved a total of $960,000 on January 1, 2021. The contractual interest rate for the bonds is 6% and the market rate of interest at the date of issue is 7% Using the straight-line method, what is the total amount of interest expense, including amortization of the discount, that XYZ should recognize on December 31, 2021 when XYZ accrues the interest on the bonds for 2021? O $70,000. O $62.000. O $58.000. O $60,000.

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter10: Long-term Liabilities

Section: Chapter Questions

Problem 10.16MCE

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