Answer:
$5,400 is the total interest expense for the current year.
Explanation:
Firstly,the cash proceeds from the bond issuance is the face value of $90,000.
However, interest expense on 30 June which is the semiannual coupon payment is computed thus:
interest expense=$90,000*6%*6/12=$2700
In addition, interest expense on 31 December which is the semiannual coupon payment is computed thus:
interest expense=$90,000*6%*6/12=$2700
The annual interest expense=$2,700+$2,700=$5,400
