Shah Entertainment Center borrowed money by issuing $6,000,000 of 4% bonds payable at 97.5. Interest is paid semiannually. Requirements 1. How much cash did Shah Entertainment Center receive when it issued the bonds payable? 2. How much must Shah Entertainment Center pay back at maturity? 3. How much cash interest will Shah Entertainment Center pay each six months? CHE

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Question 6 of 30
Shah Entertainment Center borrowed money by issuing $6,000,000 of 4% bonds payable at 97.5. Interest is paid semiannually
Requirements
1. How much cash did Shah Entertainment Center receive when it issued the bonds payable?
2. How much must Shah Entertainment Center pay back at maturity?
3. How much cash interest will Shah Entertainment Center pay each six months?
***
Requirement 1. How much cash did Shah Entertainment Center receive when it issued the bonds payable?
Amount of cash Shah Entertainment Center received when the bonds payable were issued =
Requirement 2. How much must Shah Entertainment Center pay back at maturity?
At maturity, Shah Entertainment Center must pay back
Requirement 3. How much cash interest will Shah Entertainment Center pay each six months?
Every six months, Shah Entertainment Center will pay interest of
1
Transcribed Image Text:< Question 6 of 30 Shah Entertainment Center borrowed money by issuing $6,000,000 of 4% bonds payable at 97.5. Interest is paid semiannually Requirements 1. How much cash did Shah Entertainment Center receive when it issued the bonds payable? 2. How much must Shah Entertainment Center pay back at maturity? 3. How much cash interest will Shah Entertainment Center pay each six months? *** Requirement 1. How much cash did Shah Entertainment Center receive when it issued the bonds payable? Amount of cash Shah Entertainment Center received when the bonds payable were issued = Requirement 2. How much must Shah Entertainment Center pay back at maturity? At maturity, Shah Entertainment Center must pay back Requirement 3. How much cash interest will Shah Entertainment Center pay each six months? Every six months, Shah Entertainment Center will pay interest of 1
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