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Amount of bond issue costs amortized each semiannual period

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Assume that a company issues bonds with a $100,000 face value at 100 and must pay $5,000 of costs associated with the issuance. Assume that the life of the bond is five years and that the company amortizes bond issue costs on a straight-line basis each semiannual period. What is the amount of bond issue costs amortized each semiannual period?

$100

$500

$1,000

$5,000

Reference no: EM13304293

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