Farmland corporation issued $400,000 of 10-year bonds at a discount. prior to maturity, when the carrying value of the bonds was $388,000, the company redeemed the bonds at 99. prepare the entry to record the redemption of the bonds

Carey company is borrowing $225,000 for one year at 9.5 percent from second intrastate bank. the bank requires a 15 percent compensating balance. the principal refers to funds the firm can effectively utilize (amount borrowed − compensating balance). a. what is the effective rate of interest? (use a 360-day year. input your answer as a percent rounded to 2 decimal places.) b. what would the effective rate be if carey were required to make 12 equal monthly payments to retire the loan?