1. Tano issues bonds with a par value of $96,000 on January 1, 2015. The bonds’ annual contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12%, and the bonds are sold for $88,923. 1. What is the amount of the discount on these bonds at issuance? Discount $ 7,077 Explanation: (1)  Discount = Par value – Issue price = $96,000 – $88,923 = $7,077 2. How much total bond interest expense will be recognized over the life of these bonds? Total bond interest expense over life of bonds: Amount repaid: 6 payments of $ 4,320 $ 25,920 Par value at maturity 96,000 Total repaid 121,920 Less amount borrowed (88,923) Total bond interest expense $ 32,997 Explanation: (2) Total bond interest expense over the life of the bonds   Amount repaid      Six payments of $4,320 * $ 25,920     ...