Principal = $1,000; Coupon interest rate = 10%, paid valuing it = 12%. Issued at 92.8 (i.e., 92.8% of face value). annually; Maturity = 5 years. At issuance, cash increases by $928 and bonds payable increases by $1,000. What do we do with the difference? We show it as a discount to bonds payable.

Answer rating: 100% (QA)

In this scenario when the bonds were issued at a price of 928 of the face value the cash increased b... View the full answer