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On January 1, 2014, Tonika Corporation Issued a Four-Year, $10,000

Question 55

Multiple Choice

On January 1, 2014, Tonika Corporation issued a four-year, $10,000, 7% bond. The interest is payable annually each December 31. The issue price was $9,668 based on an 8% effective interest rate. Assuming effective-interest amortization is used, the December 31, 2015 book value after the December 31, 2015 interest payment was made is closest to:


A) $9,662.
B) $9,820.
C) $9,668.
D) $9,723.

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