QUESTION 13 ud Company mest 10 year bonds with a par value of 001

Accounting Jan 16, 2021

QUESTION 13 ud Company mest 10 year bonds with a par value of 001.000.000 mat pay interest semiannually. The amount paid to the bondholders for each semiannual interest 40.000 DOO COD1000 0.000000

Expert Solution

Answer: A. 40,000

Explanation:

Interest Payable to bondholders on semi-annual basis = Par value of bond x Interest % p.a. x (6 month/12 month)

= 1,000,000 x 8% x (6 month/12 month)

= 40,000

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