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What is the maximum amount of interest

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Problem - A government has $2,000,000 of 6%, 10-year general obligation bonds outstanding. The bonds were issued on July 2, 2012 to finance construction of a general capital asset. Interest is payable semiannually on January 1 and July 1, and $200,000 of principal is due each July 1.

Required - What is the maximum amount of interest the government would report for the fiscal year ending December 31, 2012?

a. $0

b. $20,000

c. $60,000

d. $120,000

Reference no: EM132468240

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