Molteni motors inc. recently reported $3.25 million of net income. its ebit was $6.25 million, and its tax rate was 35%. what was its interest expense? (hint: write out the headings for an income statement and then fill in the known values. then divide $3.25 million net income by 1 − t = 0.65 to find the pre-tax income. the difference between ebit and taxable income must be the interest expense.) enter your answer in dollars. for example, an answer of $1.2 million should be entered as 1,200,000. round your answer to the nearest dollar.

Mae jong corp. issues $1,000,000 of 10% bonds payable which may be converted into 10,000 shares of $2 par value ordinary shares. the market rate of interest on similar bonds is 12%. interest is payable annually on december 31, and the bonds were issued for total proceeds of $1,000,000. in accounting for these bonds, mae jong corp. will: (a) first assign a value to the equity component, then determine the liability component. (b) assign no value to the equity component since the conversion privilege is not separable from the bond.(c) first assign a value to the liability component based on the face amount of the bond.(d) use the “with-and-without” method to value the compound instrument.