Question: round your answer to the nearest dollar, such as 12345. Also use the effective interest rate method. On January 1, 2014, ABX Company issues $1,000,000

round your answer to the nearest dollar, such as 12345. Also use the effective interest rate method.

On January 1, 2014, ABX Company issues $1,000,000 of 6-year bonds, with 5% coupon payable annually on December 31. The market rate of the bonds on January 1, 2014 is 4%.

a. ABX Company finances $__________ by this bond issue. (Assume there is no expenses on issuing the bond.)

b. What is the interest expense of the bond in 2014?

c. The amount of cash paid as an interest on the bond in 2014 is $__________

d. The interest expense of the bond in 2015 is $______________

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