Question - On January 1, 2013, Dawson Corporation issued debenture bonds that pay interest semiannually on June 30 and December 31. The bonds had a face value of $8M and sold for $6,627,273. The state rate of interest on the bonds is 8% and the effective interest is 10%.
Required:
1. What amount of interest expense will Dawson report in its income statement for the year ended December 31, 2013 (related to the bonds).
2. What amount(s) related to the bonds will Dawson report in its balance sheet at December 31, 2009.
3. What amount of interest expense will Dawson report in its income statement for the year ended December 31, 2014 (related to the bonds).
4. What amount(s) related to the bonds will Dawson report in its balance sheet at December 31, 2014.