Calculate the interest expense reported in each of the years

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Part B BondsThe bond is non-interest-bearing. The annual payments are zero, and the principal is CNR discloses the following liability as long-term debt (in millions):

$842k paid in 90 years

$842 is the principal of the note.

Required:

Problem 1: How much is paid annually to investors on these bonds? At maturity? calculation that shows the net proceeds on issuance if the market interest rate were 6% on the date of issuance. Round UP to the nearest million.

Problem 2: Calculate the discount on issuance and explain the meaning of the discount.

Problem 3: Calculate the interest expense reported in each of the first three years of the bond's life. Why is there interest expense if there is no cash paid?

Reference no: EM132757449

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