On january 1, 2018 legion company sold $200,000 of 10%, ten-year bonds. interest payable semiannually in june 30 and december 31 the bonds were sold for $177,000, priced to yield 12. legion records interest at the effective rate.

legion shoud report bond interest expense for the six months ended june 30, 2018, in the amount of:

a) $8,850
b) $10,000
c) $10,620
d) $12,000

legion should pay cash interest for the six months ended june 30, 2018, in the amount of:

a) $8,850
b) $10,000
c) $10,620
d) $12,000