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For this question you need to use the Time Value Factors tables you've used throughout the class. Do not round the factors. Assume annual interest rates and annual compounding and choose the answer closest to your calculation. Lopes Inc. issued bonds with a face value of $300,000 on January 1, Year 1. The bonds have a 10 year maturity. The bonds will pay annual interest at 5% at the end of every year. On the date the bonds were issued, the market rate of interest was 4%. What will be the issue price of the bonds? $324, 332 $202, 668 $318, 630 $300,000 $276, 834 Will the bond in the immediately preceding problem be issued at a premium, discount, or face value. (If you are unsure of the math in the first question, this is a chance to get some credit just by looking at the circumstances in the problem.) Face Value Discount Premium Lerner Inc. issued bonds several years ago for more than face value. The bonds had a face value of $100,000 and pay interest annually at 9% on 12/31 each year. The market rate on the date of issue was 8%. Assume the carrying value of the bonds throughout 20X2 is 104,000. Lerner prepares annual Financial statements at 12/31 each year. How much interest will the bondholders be paid on December 31, 20X2? $8,000 $9, 360 $9,000 $8, 320

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