chapter 13 question 4

On July 1 , Somers inc. Issued $400,000 of 8%,10-year bonds when the market rate was 10%. The bonds paid interest semi-annually. A. Assuming the bonds sold at 64,55 , what was the selling price of the bonds? B. Explain why the cash received from selling this bond is different from the $400,000 face value of the bond. Investors can earn a in other similar bonds so the bond sells at a On July 1 , Somers inc. Issued $400,000 of 8%,10-year bonds when the market rate was 10%. The bonds paid interest semi-annually. A. Assuming the bonds sold at 64,55 , what was the selling price of the bonds? B. Explain why the cash received from selling this bond is different from the $400,000 face value of the bond. Investors can earn a in other similar bonds so the bond sells at a