Question: Enviro Company issues 8%, 10-year bonds with a par value of $250,000 and semiannual interest payments. On the issue date, the annual market rate for

Enviro Company issues 8%, 10-year bonds with a par value of $250,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 10%, which implies a selling price of 87 . The straight-line method is used to allocate interest expense.

1. Using the implied selling price of 87 , what are the issuer's cash proceeds from issuance of these bonds?

What is the cash proceeds ?

2. What total amount of bond interest expense will be recognized over the life of these bonds?

Amount repaid?

? payments of ?

what is the par value of maturity ? What is the less amount borrowed from part 1 ?

3. What is the amount of bond interest expense recorded on the first interest payment date?

What is the bond Intrest expense ?

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