What Is the Interest Expense on the Bonds in 2010

question 12

Multiple Choice

What is the interest expense on the bonds in 2010?

• A)$800,000.
• B)$680,759.
• C)$342,961.
• D)$119,241.Semiannual effective rate = $344,632 / $11,487,747 = 3% Interest expense = $341,261 + ($11,316,611 3%) = $680,759

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Definitions:

Dike

A sheetlike intrusion that cuts across any layers in a host rock, commonly formed with a steep orientation.

Sill

A tabular igneous intrusion that parallels layers or other planar structures of the surrounding rock and which usually has a subhorizontal orientation.

Laccolith

A bulge-shaped igneous body that has domed and tilted overlying layers and that is observed or interpreted to have a relatively flat floor.

Felsic Magmas

Magma that is high in silica and light in color, which forms rocks such as granite and rhyolite upon cooling.