Question: On January 2, 2014, Weatherly Company issued $8,000,000 of their 10-year bonds at 96. The bonds have a stated rate of 6% and the annual interest payments are made each December 31.
Required: Compute the following amounts. Show 3 decimal places for the effective interest rate (such as 7.042%). Show computations.
1. Proceeds from the bond sale.
2. Effective interest rate (annual).
3. Amount of each interest payment.