Brian Wood Production Company is issuing $250,000 of ten-year, $1,000-face value bonds. The bonds carry a 9.5

Question:

Brian Wood Production Company is issuing $250,000 of ten-year, bonds. The bonds carry a 9.5 percent interest rate, paid annually.
Required:
(a) How much total cash interest will investors receive each year?
(b) Prepare the journal entry to issue the bonds if they are sold at
(1) 100.
(2) 97.
(3) 102.
(c) For items (1), (2), and (3) in part (b), indicate whether the bonds were sold at a premium, discount, or and what that means about the relationship between the stated rate of interest and the market rate of interest.
(d) For items (1), (2), and (3) in part (b), how much will the investors receive at maturity?
Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...