Question
7 Cargo Express Airways issued 10-year, 8% bonds with a par value of $200,000. Interest is paid semiannually. The market rate on the issue date
7
Cargo Express Airways issued 10-year, 8% bonds with a par value of $200,000. Interest is paid semiannually. The market rate on the issue date was 7.5%. Cargo Express Airways received $206,948 in cash proceeds. Which of the following statements is true?
- Cargo Express Airways must pay $200,000 at maturity plus 20 interest payments of $8,000 each.
- Cargo Express Airways must pay $200,000 at maturity plus 20 interest payments of $7,500 each.
- Cargo Express Airways must pay $200,000 at maturity and no interest payments.
- Cargo Express Airways must pay $206,948 at maturity plus 20 interest payments of $8,000 each.
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Management and Cost Accounting
Authors: Colin Drury
8th edition
978-1408041802, 1408041804, 978-1408048566, 1408048566, 978-1408093887
