DrumCorp issued a $100,000 "face value" 4-year, zero-coupon (i.e. no stated interest rate) bonds on...
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Accounting
DrumCorp issued a $100,000 "face value" 4-year, zero-coupon (i.e. no stated interest rate) bonds on January 1 when the market yield was 6%. The bond agreement stated that compounding of interest was done annually. How much are the proceeds of the original bond issue (select the one answer closest to the number you compute)? A. $100,000 B. $89,843 C. $79,210 D. $62,317 E. $80,645
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