Final answer:
The total bond interest expense to be recognized over the bonds' life is $290,400.
Step-by-step explanation:
In order to determine the total bond interest expense to be recognized over the bonds' life, you need to calculate the interest payment for each period and multiply it by the number of periods. In this case, Legacy issued $660,000 of 5.5% four-year bonds. The interest is paid semiannually on June 30th and December 31st. The bonds were issued at $648,412 with a market rate of 6% at the issue date.
To calculate the bond interest expense for each period, we need to determine the interest payment and the number of periods. The interest payment is calculated by multiplying the face value of the bond by the coupon rate. In this case, the face value of the bond is $660,000 and the coupon rate is 5.5%, so the interest payment is $36,300 ($660,000 x 5.5%).
The number of periods can be calculated by multiplying the number of years by the number of payment periods per year. In this case, the bonds have a term of four years and interest is paid semiannually. So the number of periods is eight (4 years x 2 payment periods per year).
Finally, we can calculate the total bond interest expense by multiplying the interest payment by the number of periods. In this case, the total bond interest expense over the bonds' life is $290,400 ($36,300 x 8 periods).