Check my work Check My Work button is now enabledItem 3 Required information Skip to question [The following information applies to the questions displayed below.] Forces of supply and demand cause a bond to be priced to yield the market rate, calculated as the present value of all the cash flows required, where the discount rate is the market rate. Interest expense is calculated as the effective market rate of interest multiplied by the outstanding balance (during the interest period). A company is permitted to allocate a discount or a premium equally to each period over the term to maturity if doing so produces results that are not materially different from the interest method. Knowledge Check 01 On January 1, Year 1, Willette Company sold $240,000 of 6% ten-year bonds. Interest is payable semiannually on June 30 and December 31. The bonds were issued for $180,181, priced to yield 10%. What is the amount of effective interest expense that should be recorded for the six months ended June 30, Year 1