Compute the cash proceeds from bond issues under the following terms. For each case, indicate whether the bonds sold at a premium or discount:

1. Pear, Inc. issued $400,000 of 10-year , 8 percent bounds at 103
2. Apple Inc. issued $200,000 of five-year ,12 percent bounds at 97 ^1/2 .
3. Cherry Co. issued $100,000 of five-year ,6 percent bounds at 102 ^1/4 .
4. Grape, Inc. issued $120,000 of five-year ,8 percent bounds at 96.

Answer rating: 100% (QA)

Bound discounts When the selling price of a bound is lower than its face value the bond is sai8d to be issued at a discount Example company a issued 5... View the full answer