Answer:
consolidated income statemnt interest expense: 14,500
net long-term debt consolidaded: 232,500
Explanation:
Jay thinks the long-term debt carries a discount.
Which makes the fair value 20,000 less, thus increasing hte interest expense.
amortization on discount: 20,000 / 8 = 2,500
interest expense in the consolidated statement:
12,000 + 2,500 = 14,500
adjusted balance ofthe discount: 20,00 - 2,500 = 17,500
long term debt: 250,000
discount on debt<u> 17,500 </u>
net 232,500
