On January 1, 2020, Coronado Industries issued ten-year bonds with a face amount of $5400000...
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On January 1, 2020, Coronado Industries issued ten-year bonds with a face amount of $5400000 and a stated interest rate of 7% payable annually on January 1. The bonds were priced to yield 9%. Present value factors are as follows:
Present value of 1 for 10 periods: At 7% : 0.508 At 9% : 0.422
Present value of an ordinary annuity of 1 for 10 periods: At 7% : 7.024 At 9% : 6.418
The total issue price of the bonds was a) $5400000 b) $5292000 c) $4704804 d) $5022000.
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