Homework: Chapter F:14 Homework Question 3, EF14-21 (similar to) Part 6 of 6 HW Score: 53.17%, 3.19 on Points: 0.67 of 1 Havens Company is planning to issue $450,000 of 12%, ten-year bonds payable to borrow for a major expansion. The owner, Anthony Havens, asks your advice on some related matters. Read the requirements Requirement 1. Answer the following questions. At what type of bond price will Havens Company have total interest expense equal to the cash a. interest payments? Face value Under which type of bond price will Havens Company's total interest expense be greater than the b. cash interest payments? Discount price If the market interest rate is 14%, what type of bond price can Havens Company expect for the Discount price c. bonds? Requirement 2. Compute the price of the bonds if the bonds are issued at 89 The price of the $450,000 bond issued at 89 is 400.500 Requirement 3. How much will Havens Company pay in interest each year? How much will Havens Company's interest expense be for the first year? (For this scenario we are assuming that the $4 that the straight-line method is used.) If the $450,000 bonds are issued at 89, Havens Company will pay this amount of interest each year (Round your answers to the nearest whole dollar) Assuming that the straight-line method is used, Havens Company's interest expense for the first year will be $54,000