Part 1 On April 1, 2020, Shelter Bay Inc. has available for issue $900,000 bonds due in

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Part 1

On April 1, 2020, Shelter Bay Inc. has available for issue $900,000 bonds due in four years. Interest at the rate of 10% is to be paid quarterly. Calculate the issue price if the market interest rate is:

a. 11%

b. 10%

c. 9%

Part 2

On October 1, Shelter Bay Inc. has available for issue a $326,000 bond due in eight years. Interest at the rate of 12% is to be paid semiannually. Calculate the issue price if the market interest rate is:

a. 11.50%

b. 12.00%

c. 12.75%

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Related Book For  book-img-for-question

Fundamental Accounting Principles Volume II

ISBN: 978-1260305838

16th Canadian edition

Authors: Kermit Larson, Tilly Jensen, Heidi Dieckmann

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