Sparks Company Received Proceeds of $634,500 on 10-Year, 8% Bonds

question 17

Multiple Choice

Sparks Company received proceeds of $634,500 on 10-year, 8% bonds issued on January 1, 2019.The bonds had a face value of $600,000, pay interest annually on December 31, and have a call price of 102.Sparks uses the straight-line method of amortization.What is the amount of interest expense Sparks will show with relation to these bonds for the year ended December 31, 2020?

• A)$48,000
• B)$50,760
• C)$44,550
• D)$37,650

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