McDonald Sales Prepared a Bond Issue of $20,000 Dated January

question 157

Multiple Choice

McDonald Sales prepared a bond issue of $20,000 dated January 1,2013.The bonds have a stated rate of 3% and a term of 6 years.The bond issue was delayed,and the bonds were finally sold on March 1,2013 at par.On June 30,2011,the first semiannual interest payment is made.How much is the total amount of interest expense McDonalds will record for the first half of 2013?

• A) $600
• B) $200
• C) $300
• D) $350

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Definitions:

Industry Structure

The characteristics that influence the nature of competition and pricing in a particular industry, including the number and size of firms, entry barriers, and product differentiation.

Government Restrictions

Regulations imposed by authorities to control or limit certain activities, behaviors, or operations.

Exclusive Right

A legal provision giving the holder the sole permission to produce, use, or sell a particular commodity or concept.

Cement

A binding agent used in construction that sets, hardens, and adheres to other materials, commonly used to bind sand and gravel in concrete.