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Cleveland Purchased $200,000 of Clair Company's 10-Year, 9 Percent Bonds

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Cleveland purchased $200,000 of Clair Company's 10-year, 9 percent bonds for $166,100 on July 1, 2012. Cleveland purchased the bonds to yield 12 percent interest. If Cleveland uses the effective-interest method to amortize discounts, how much interest revenue should Cleveland recognize for 2012 as a result of the investment?


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