Question - On 1/1/2015 Gladrags Company issued a 5-year bond payable with a face value of $60,000 and an annual stated interest rate of 6%. Interest payments are made semi-annually on each June 30 and December 31, starting 6/30/2015. The market interest rate on similar bonds is 4%. Round all calculations to the nearest dollar.
On 1/1/2015, Gladrags will record a credit to Premium on bond payable in the amount of
What amount of interest expense will Gladrags record on 6/30/2016 for the bond issued on 1/1/2015? Round to the nearest dollar.