On January 1,2019,Naperville Corporation Issued $2,300,000,12%,5-Year Bonds with Interest Payable

question 120

Multiple Choice

On January 1,2019,Naperville Corporation issued $2,300,000,12%,5-year bonds with interest payable on January 1 and July 1.The bonds sold for $2,446,400.The market rate of interest was 10%.Using the effective-interest method,the debit entry to interest expense on July 1,2019 is (round to the nearest dollar) :

• A)$115,000.
• B)$146,784.
• C)$122,320.
• D)$138,000.

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Definitions:

Total Revenue

The overall amount of money generated by the sale of goods or services before any costs are subtracted.

Price Effect

The impact on consumer demand and producer behavior due to a change in the price of a good or service, holding other factors constant.

Quantity Effect

The impact on total revenue when the quantity sold changes while holding price constant.

Total Revenue

The total amount of money generated from the sale of goods or services before any costs or expenses are deducted.