Part 1On April 1, 2020, Shelter Bay Inc. has available for issue S00,000 bonds due in four years. Interest at the rate of 10% is to be paid quarterty. Calculatethe issue price if the market interest rate isa IISb. 10%C9%Part 2On October 1, Shelter Bay Inc. has available for issue a $326.000 bond due in eight years Interest at the rate of 125 is to be paid semiannually. Calculatethe issue price if the market interest rate isa. IL.SONb. 12.00%

Part 1 On April 1, 2020. Shelter Bay Inc. has available for issue S00,000 honds due in four years Interest at the rate of 10% is to be paid quarterty. Calculaie the issue price if the market interest rate is b. 10%

Part 1 On April 1, 2020. Shelter Bay Inc. has available for issue S00,000 honds due in four years Interest at the rate of 10% is to be paid quarterty. Calculaie the issue price if the market interest rate is b. 10%

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter10: Long-term Liabilities

Section: Chapter Questions

Problem 10.1P

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Question

100%

Part 1
On April 1, 2020, Shelter Bay Inc. has available for issue S00,000 bonds due in four years. Interest at the rate of 10% is to be paid quarterty. Calculate
the issue price if the market interest rate is
a IIS
b. 10%
C9%
Part 2
On October 1, Shelter Bay Inc. has available for issue a $326.000 bond due in eight years Interest at the rate of 125 is to be paid semiannually. Calculate
the issue price if the market interest rate is
a. IL.SON
b. 12.00%

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