On June 30, 20, Nash Bros., sold $1,200,000 (face value) of bonds. The bonds are dated June 30, 2001, and pay interest semi-annually on Dec. 31 and June 30, and will mature on June 30, 2004. The following schedule was prepared by the accounting dept:

Semi-annual Interest to be Interest Expense Amortization Unamortized Bond Carrying Interest Period

Paid

Amount

Amount $ 62,906

$ 1,137,094 1

$ 36,000

$ 45,484

$ 9,484

$ 53,422

$ 1,146,578 

On the basis of the above information, answer the following questions (round to the nearest dollar or percent) (8K) 

a) What is the stated rate of interest for this bond? 

b) What is the market rate of interest for this bond? 

c) What was the selling price of the bond as a percentage of the face value? 

d) Prepare the journal entries for June 30 and Dec. 31, 2001.

Answer rating: 100% (QA)

a What is the stated rate of interest for this bond Interest to be paid Face value ... View the full answer