Ask Question
BusinessBusiness
2 November, 03:28

On March 2, 2019, 20-year, 6 percent, general obligation serial bonds were issued at the face amount of $3,000,000. Interest of 6 percent per annum is due semiannually on March 1 and September 1. The first payment of $150,000 for redemption of principal is due on March 1, 2020. Fiscal year-end occurs on December 31. What is the interest expenditure for the fiscal year ending December 31, 2019

+2
Answers (1)
  1. 2 November, 07:01
    0
    The answer is $90,000

    Explanation:

    Interest rate is 6percent

    Principal is $3,000,000

    Annual repayment:

    6percent of $3,000,000

    = $180,000

    Therefore, semi annual (2 times a year) will be:

    $180,000 : 2

    $90,000

    The bond was issued on March 2, 2019. And the payment is semiannual (meaning the interest will be paid two times a year). And the payment date for interest are March 1 and September 1 of every year till it expires.

    The payment for March 1 2019 is not possible because the bond was issued March 2, 2019 and the interest payment has not started. Therefore, the next repayment of $90,000 is September 1. And this will be the interest expenditure for the fiscal year ending December 31, 2019
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “On March 2, 2019, 20-year, 6 percent, general obligation serial bonds were issued at the face amount of $3,000,000. Interest of 6 percent ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Perez, Inc. recently completed 58,000 units of a product that was expected to consume 4 pounds of direct material per finished unit. The standard price of the direct material was $7.50 per pound.
Answers (1)
Who is the richest dude on earth
Answers (2)
What step can an organization take to improve its culture? A. conduct regular development programs for employees B. employ people belonging to a certain age group only C. keep its number of employees to a minimum D.
Answers (1)
Freddy sells health insurance packages for small businesses. He has been given the names of ten new businesses in his town. During the qualifying leads stage of the selling process, Freddy will likely try to assess which of the ten businesses
Answers (1)
Decorators Inc. hired you to design a marketing campaign that will appeal to young professionals. You have studied the purchasing behaviors of young professionals and decided on the campaign design you are going to implement.
Answers (1)
New Questions in Business
True or false Each consumer has a credit score in their credit report and the score adjusts up or down each month, based on positive or negative information reported by creditors
Answers (1)
Which type of unemployment is caused by a lack of demand for workers as a result of a shrinking economy?
Answers (1)
Actionable performance measures should be meaningful to a company's management and should provide the basis for decisions at the strategic level in an organization. A. True B. False
Answers (1)
In what countries is it important to keep a certain distance from the person you are greeting?
Answers (1)
If a company is using the accrual basis accounting method, when should it record its earned revenue? a. when cash is received, even though services may be rendered at a later date b.
Answers (1)
Home » Business » On March 2, 2019, 20-year, 6 percent, general obligation serial bonds were issued at the face amount of $3,000,000. Interest of 6 percent per annum is due semiannually on March 1 and September 1.
Sign Up Forgot Password?