Wayne Company issued bonds with a face value of $600,000, a 6% stated rate of interest, and a 10-year term. The bonds were issued on January 1, 2016, and Wayne uses the straight-line method of amortization. Interest is paid annually on December 31.
Assuming Wayne issued the bond for 102½, the amount of interest expense appearing on the 2016 income statement would be: A. $34,500.
B. $36,000.
C. $37,500.
D. $15,000.
