Question: The Akimbo Company issues bonds with a face value of $12 million on June 1, Year One, for 93 percent of face value plus

The Akimbo Company issues bonds with a face value of $12 million on June 1, Year One, for 93 percent of face

The Akimbo Company issues bonds with a face value of $12 million on June 1, Year One, for 93 percent of face value plus accrued interest. The bonds pay an annual cash interest rate of 10 percent with payments made on April 1 and October 1 of each year. The bonds were sold at a discount to create an effective interest rate of 12 percent per year. What amount of cash interest will Akimbo actually pay during Year One?

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