Quiz Ch. 10

1) A bond traded at 97½ means that

2. A bondholder that owns a $1,000, 6%, 15-year (term) bond has

3. A company issues 8%, 20-year bonds with a par value of $500,000. The current market rate for the bonds is 8%. The amount of interest owed to the bondholders for each semiannual interest payment is

4. A company issued five-year, 5% bonds with a par value of $100,000. The company received $95,735 for the bonds. Using the straight-line method, the company’s interest expense for the first semiannual interest period is

5. A company issued eight-year, 5% bonds with a par value of $350,000. The company received proceeds of $373,745. Interest is payable semiannually. The amount of premium amortized for the first semiannual interest period, assuming straight-line bond amortization, is