A $100,000 bond bears an interest rate of 6%. The bond was issued at a price of $95,000. The actual amount of interest that the bondholder would receive each year is: a. $6,000 b. $3,000 c. $5,700 d. $5,000
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- Krystian Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 4% when the market rate was 6%. Interest was paid semi-annually. Calculate and explain the timing of the cash flows the purchaser of the bonds (the investor) will receive throughout the bond term. Would an investor be willing to pay more or less than face value for this bond?A company issued bonds with a $100,000 face value, a 5-year term, a stated rate of 6%, and a market rate of 7%. Interest is paid annually. What is the amount of interest the bondholders will receive at the end of the year?On July 1, a company sells 8-year $250,000 bonds with a stated interest rate of 6%. If interest payments are paid annually, each interest payment will be ________. A. $120,000 B. $60,000 C. $7,500 D. $15,000
- On January 1, a company issued a 5-year $100,000 bond at 6%. Interest payments on the bond of $6,000 are to be made annually. If the company received proceeds of $112,300, how would the bonds issuance be quoted? A. 1.123 B. 112.30 C. 0.890 D. 89.05A $100,000 bond bears an interest rate of 6%. The bond was issued at a price of $95,000. The actual amount of interest that the bondholder would receive each year is: a. $6,000 b. $3,000 c. $5,700 d. $5,000A bond promises to pay $5,350 next year. The interest rate on this bond is 7%. The price of this bond today must be: a. $5,000 b. $5,100 c. $5,200 d. $5,240
- An 8%, P1,000 bond issued to yield 10% has 6 years remaining in its term. The bond pays interest annually; the next interest payment is due on year from today. What is the issuer’s carrying amount of the bond using the interest method of amortizing bond discount and premium? A. 913 B. 633 C. 667 D. 819Company C issued a 5-year bond with a face value of $1,000,000 and a stated interest rate of 8%. The bond pays interest annually. If the market interest rate is 6%, what is the selling price of the bond?A$ 25, 000, 5% bond payable semi-annually is purchased seven years before maturity. Calculate the purchase price and discount on the bond if the quoted price on the date of purchase was 95.2. O a. Purchase Pricer= $ 23, 800 Discount = $ 1, 200 O b. Purchase Price = $20, 000 Discount = $ 1, 400 %3! O . Purchase Price = $ 25, 000 Discount = $ 1,200 %3D O d. Purchase Price = $ 18, 500 Discount = $ 1, 500
- You purchase a $10,000 bond with a bond rate of 6% per year payable semiannually for 2 years. You pay $9,600 for the bond. Which statement is correct?2. A 10-year, P20,000 bond was issued at a nominal interest rate of 8% with semiannual compounding. Just after the fourth interest payment, the bond will be sold. Assume that an effective interest rate of 10 % % will apply, and calculate the price of the bond.2. DEF Company will issue $8,000,000 in 10%, 10-year bonds when the market rate of interest is 7%. Interest is paid semiannually. Required: a. Will this interest structure result in a Premium for DEF company or a Discount? b. How much cash will be received from the issuance of the bond? c. How much will the semi-annual interest payment be on the bond?