5)

A company issues a $1,000,000, 5%, 20-year bonds that pays interest semiannually.

What amount of interest would the company pay ever six months?

6)

A company issues a $1,000,000, 5%, 20-year bonds that pays interest semiannually.

The market interest rate at the time the bond is issued is 6%.

Will this bond be sold at par, a premium or a discount?

7)

For the amounts needed to compute the debt-to-equity ratio, which financial statement(s) would you use?

Balance Sheet only

Income Statement only

Both the Income Statement and Balance Sheet