ABC issues bonds to help pay for a new acquisition. The face value of the bonds being issued is $150,000. The bonds will be repaid in 10 years. The coupon rate on the bonds is 8%. The bonds pay interest semi-annually.

2) If the market rate at the time of issuance was 6%, how much will ABC pay to bondholders over the life of the bonds?

3) If the market rate at the time of issuance was 6%, how much interest (total proceeds) will ABC receive upon issuance of the bonds?

5) If the market rate at the time of issuance was 10%, how much interest (total proceeds) will ABC receive upon issuance of the bonds?

6) If the market rate at the time of issuance was 6%, what will be the bond premium recognized upon issuance of the bonds?

7) If the market rate at the time of issuance was 6%, what would be the amount of interest expense if the amortization of the bond premium was $831 for the first payment of interest to bondholders?

8) When the bond is repaid at maturity, what is the total amount of cash paid to bondholders to repay the principle of the bond?

9) What should be the balance in the bond payable after the bonds are repaid in ten (10) years?

10) As the market rate continues to increase, what happens to the proceeds ABC will receive given the coupon rate of 8%?