On January 1,2013,Lane Issues $700,000 of 7%,15-Year Bonds at a Price

question 70

Multiple Choice

On January 1,2013,Lane issues $700,000 of 7%,15-year bonds at a price of 106¾.The interest payments are made on June 30 and December 31.Lane elects a fiscal year ending September 30.What is the amount that would be recorded as interest expense in the December 31,2013,journal entry?

• A)$24,500.00
• B)$22,925.00
• C)$12,250.50
• D)$11,462.50
• E)$13,458.00

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Definitions:

Graphical Plot

A visual representation of data points on a coordinate system, used to observe relationships or patterns within the data.

Economies of Scale

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Cycle Inventory

Inventory that turns over regularly in the course of business operations, representing the portion of inventory intended to meet normal demand.

Supply Chain

The network between a company and its suppliers to produce and distribute a specific product to the final buyer.