On January 1,2010,Jacob Issues $800,000 of 9%,13-Year Bonds at a Price

question 64

Multiple Choice

On January 1,2010,Jacob issues $800,000 of 9%,13-year bonds at a price of 96½.Six years later,on January 1,2016,Jacob retires 20% of these bonds by buying them on the open market at 105½.All interest is accounted for and paid through December 31,2015,the day before the purchase.The straight-line method is used to amortize any bond discount. What is the total interest expense for the life of the bond?

• A)$936,000
• B)$964,000
• C)$936,000.
• D)$772,000
• E)$844,000