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QUESTION

On May 1, 2013, Ezzy Company issued a 6-year bond worth $400,000 with an interest rate of 8% per annum. Interest is to be paid semi-annually on...

On May 1, 2013, Ezzy Company issued a 6-year bond worth $400,000 with an interest rate of 8% per annum. Interest is to be paid semi-annually on October 31 and April 30. At the time of the issuance, the market interest rate was 6%. Ezzy Company amortizes any premium or discount using the straight-line method.

Calculate the bond issue price and the resulting premium or discount.

Do not enter dollar signs or commas in the input boxes.

Round your answers to 2 decimal places.

Use the present value tables in the textbook.

Bond issue price: $Answer

Premium or discount: $Answer

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