If a company issues $100,000 Face Value, 10 year bonds with a contractural interest rate of 6%, which of the following situations could occur? a. Bonds will be sold at a premium when the market rate of interest is 7% b. Bonds will be sold at a discount when market rate is of interest 7% c. Bonds will be sold at face value when market rate of interest is 7% d. The issue of bonds cannot be sold when market rate is 7%
If a company issues $100,000 Face Value, 10 year bonds with a contractural interest rate of 6%, which of the following situations could occur? a. Bonds will be sold at a premium when the market rate of interest is 7% b. Bonds will be sold at a discount when market rate is of interest 7% c. Bonds will be sold at face value when market rate of interest is 7% d. The issue of bonds cannot be sold when market rate is 7%
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 18MC: OShea Inc. issued bonds at a face value of $100,000, a rate of 6%, and a 5-year term for $98,000....
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If a company issues $100,000 Face Value, 10 year bonds with a contractural
interest rate of 6%, which of the following situations could occur?
a. Bonds will be sold at a premium when the market rate of interest is 7%
b. Bonds will be sold at a discount when market rate is of interest 7%
c. Bonds will be sold at face value when market rate of interest is 7%
d. The issue of bonds cannot be sold when market rate is 7%
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