The cash received from the bond issuance was $498 million to fund the US Bank Stadium construction, but only $462 million was owed to the bond holders who purchased the bonds when the bonds mature. When the bonds were issued, the following transaction was recorded by the state and city. Let's assume this transaction was recorded on January 1, 2014. Cash 498 million Bonds Payable 462 million Bond Premium 36 million

Question 1. What is the face amount of this bond issue?

options: a) $1.1 billion b) $36 million c) $462 million d) $498 million

Question 2- The bonds were issued at a market price of 107.8. Show/explain how is the 107.8 calculated.

Question 3-Explain why a bond payable liability of $462 million was recorded when $498 million was received in cash? In other words, why was there a bond premium, which resulted in the recording of the bond issuance like it shows above?

Question 3 options:

A) The market interest rate at the time the bond issued was higher than the stated (coupon) rate on the bond.

B)The stated (coupon) rate on the bond was higher than the market interest rate at the time the bond was issued.

Question 4 These bonds were issued as serial bonds. Explain the difference between serial bonds and term bonds?

Question 5 Of the $462 million in bonds payable, $392 million were tax exempt bonds. What are tax exempt bonds?