Question: Knoepfle Corporation s bonds have a face value of 11 000 000
Knoepfle Corporation’s bonds have a face value of $ 11,000,000 and a call price of 103. On February 1, 2012, the bonds have a carrying value of $ 11,200,000 on Knoepfle’s books and a market price of 98 3 4 in the secondary market. If Knoepfle wants to retire the entire bond issue, how much will it have to pay if it calls the bonds? How much will it pay if it buys the bonds in the secondary bond market?
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