At the beginning of 2015, Churchill Corp. issued 10% bonds with a face value of $1,200,000. These bonds mature in five years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $1,111,680 to yield 12%. Since Churchill uses a calendar-year reporting period and the effective interest method of amortization, what interest expense should the corporation report for 2015

$133,803.65

Explanation:

discount on bonds payable = $88,320

first coupon payment

amortization of discount = ($1,111,680 x 6%) - $60,000 = $6,700.80

total interest expense for first coupon payment = $66,700.80

second coupon payment

amortization of discount = ($1,118,380.80 x 6%) - $60,000 = $7,102.85

total interest expense for second coupon payment = $67,102.85

total interest expense for the year = $133,803.65

answer; ///(resources);

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.