Hooker Company issues $200,000 of ten-year, 8% bonds to yield 10% on January 1, 2018. The...
Hooker Company issues $200,000 of ten-year, 8% bonds to yield 10% on January 1, 2018. The bonds pay interest annually on December 31. The bonds were sold at a discount of $24,578.
The amount of cash interest paid in 2018 on the bonds is:
Multiple Choice
a) $14,458.
b) $16,000.
C) $17,542.
d) $20,000.
Homework Answers
calculate cash interest paid
Cash interest paid = Face value*Rate*Time
= 200000*8%
Cash interest paid = $16000
So answer is b) $16000
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