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City Bank has $400,000 of 10% debenture bonds outstanding. The bonds were issued at 106 in 2018 and mature in 2038. The bonds have annual

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City Bank has $400,000 of 10% debenture bonds outstanding. The bonds were issued at 106 in 2018 and mature in 2038. The bonds have annual interest payments. Read the requirements. Requirement 1. How much cash did City Bank receive when it issued these bonds? City Bank received $ 424,000 at bond issuance. Requirement 2. How much cash in total will City Bank pay the bondholders through the maturity date of the bonds? through the maturity date of the City Bank will pay the bondholders $ bonds. i Requirements X 1. How much cash did City Bank receive when it issued these bonds? 2. How much cash in total will City Bank pay the bondholde:ts through the maturity date of the bonds? 3. Calculate the difference between your answers to requirements 1 and 2. This difference represents City Bank's total interest expense over the life of the bonds. 4. Compute City Bank's annual interest expense using the straight-line amortization method. Multiply this amount by 20. Your 20-year total should be the same as your answer to requirement 3

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