Question: On June 30, 2011, Singleton Computers issued 6% stated rate bonds with a face amount of $200 million. The bonds mature on June 30, 2026

On June 30, 2011, Singleton Computers issued 6% stated rate bonds with a face amount of $200 million. The bonds mature on June 30, 2026 (15 years). The market rate of interest for similar bond issues was 5% (2.5% semiannual rate). Interest is paid semiannually (3%) on June 30 and December 31, beginning on December 31, 2011.

Required:
1. Determine the price of the bonds on June 30, 2011.
2. Calculate the interest expense Singleton reports in 2011 for these bonds.

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