Auerbach Inc. issued 6% bonds on October 1, 2016. The bonds have a maturity date of
September 30, 2026 and a face value of $600 million. The bonds pay interest each
March 31 and September 30, beginning March 31, 2017. The effective interest rate
established by the market was 8%.
Assuming that Auerbach issued the bonds for $518,454,000, what would the company
report for its net bond liability balance at December 31, 2016, rounded to the nearest
thousand? (Do not round intermediate calculations.)
Multiple Choice
$509,454,000.
$519,823,000.