TB12 suffered a significant decline in financial performance and decided to issue bonds to raise capital for operating purposes. The bonds were issued with a face value of $50 million on January 1, 2021 with a stated interest rate (coupon rate) of 10% when the effective rate (market rate) was 9%. Which of the following is true regarding the bond issuance?

 

1. The bonds were issued at a discount.
2. The bonds were issued at a premium.
3. The bonds were issued at par.
4. The bonds were issued at face value.
5. None of the answers are correct.

Answer rating: 100% (QA)

The detailed answer for the above question is provided below You are correct In this scenario TB12 i... View the full answer