Question
4) (15 point) On January 1, 2018, Water Mania issues $1,000,000 of 6% bonds, due in ten years, with interest payable semi-annually on June 30
4) (15 point) On January 1, 2018, Water Mania issues $1,000,000 of 6% bonds, due in ten years, with interest payable semi-annually on June 30 and December 31 each year.
Required: 1. If the market interest rate is 6%, the bonds will issue at $1,000,000. Record the bond issue on January 1, 2018, and the first two semi-annual interest payments on June 30, 2018, and December 31, 2018. (5 point)
2. If the market interest rate is 7%, the bonds will issue at $928,938. Record the bond issue on January 1, 2018, and the first two semi-annual interest payments on June 30, 2018, and December 31, 2018. (5 point)
3. If the market interest rate is 5% the bonds will issue at $1,077,946. Record the bond issue on January 1, 2018, and the first two semi-annual interest payments on June 30, 2018, and December 31, 2018. (5 point)
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