A $500,000, ten year, 7% bond issue was sold to yield 6% interest payable annually. Actuarial information for 10 periods is as follows:

present value $1 @ 7% = 0.50835 @ 6% = 0.55839

present value of an annuity of $1 @ 7% = 7.02359 @ 6% = 7.36009

The discount or premium at the date of bond issuance would be:

A $500,000, ten year, 7% bond issue was sold to yield 6% interest payable annually. Actuarial information for 10 periods is as follows:

present value $1 @ 7% = 0.50835 @ 6% = 0.55839

present value of an annuity of $1 @ 7% = 7.02359 @ 6% = 7.36009

The discount or premium at the date of bond issuance would be:

$11,778

$35,117 discount

$10,097 discount

$36,798 premium