On January 1,2014,Partridge Company Issued $50,000 of 6-Year Bonds with a Stated

question 38

Multiple Choice

On January 1,2014,Partridge Company issued $50,000 of 6-year bonds with a stated rate of 3%.The market rate at time of issue was 4%,so the bonds were discounted and sold for $47,331.Partridge uses the effective-interest rate of amortization for bond discount.Semiannual interest payments are made on June 30 and December 31 of each year.How much interest expense will be recorded when the first interest payment is made? (Please round to the nearest whole dollar.)

• A) $167
• B) $947
• C) $750
• D) $2,000

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Definitions:

Sales Units

A measure of the quantity of products sold or services provided over a period of time.

Revenue Expected

The income that a company anticipates receiving from its normal business activities, such as sales of goods or services, during a specific period.

Planned Sales

Forecasted or projected revenue figures based on market analysis, historical data, and anticipated sales activities, important for budgeting and strategic planning.

Projected Sales

The estimated amount of sales revenue that a company expects to achieve in a future period based on market research and historical data.