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What amount of interest revenue that will Zou recognize

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Question - On January 1, 2019, Zou, Inc. purchased $500,000 of Tengesdal Company's 10-year, 10% bonds for $532,090 to yield 9%. Interest is payable each December 31. The bonds are classified as held-to-maturity. Zou, Inc. uses the effective-interest method. What is the amount of interest revenue that will Zou recognize in 2020 for these bonds?

a. $47,890

b. $53,208

c. $47,698

d. $50,000

e. None of these is correct.

Reference no: EM132531673

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