On March 30, 2009, Canine Company issued $80,000 worth of 10-year, 6% bonds when the market rate was 5%. Proceeds were $86,177. The interest is paid annually on March 30.
1. What is the annual interest payment?
2. What is the amount of interest expense on the date of the first interest payment?
3. How would the bonds payable and the interest expense be shown on the year-end (March 30, 2010) financial statements?