What macadamia report as interest expense for year ended

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Question 1: On January 1, 2021, MACADAMIA Company issued 5 year bonds with face value of ?5,000,000 at 110. The company paid bond issued cost of ?80,000 on same date. The stated interest rate on the bonds is 8% payable annually every December 31. After consideration of bond issue costs to be initially measured, the bonds were determined to yield 6% per annum. On December 31, 2021, what should MACADAMIA report as interest expense for the year ended, December 31, 2021?

Option 1: ? 295,200

Option 2: ? 433,600

Option 3: ? 300,000

Option 4: ? 325,200

Reference no: EM132999175

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