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Unformatted text preview: nteres t ex pens e Dis c ount on bonds pay able Cas h Cre dit 4,500 4,904+/ -0 .1 % 404+/ -1 .5 % 4,500 5. As s uming the mark et rate is s till 10% , what pric e would a s ec ond inves tor pay the firs t inves tor on June 30, 2015, for $10,000 of the bonds ? ezto.mhecloud.mcg r aw- hill.com/hm_accounting .tpx?todo= pr intviewSing le 3/5 2/25/14 Assig nment Pr int View Pric e of the bonds $ 9,864+/ -0 .1 % rev: 11_16_2013_QC_39855 Explanation: 1. Cas h Pay ment 4.5% × Fac e Amount 1 2 3 4 5 6 7 8 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 Effec tive Interes t 5% × Outs tanding Balanc e 0.05 (96,768) 0.05 (97,106) 0.05 (97,461) 0.05 (97,834) 0.05 (98,226) 0.05 (98,637) 0.05 (99,069) 0.05 (99,522) = = = = = = = = Inc reas e in Balanc e 338 355 373 392 411 432 453 478 39,232 36,000 4,838 4,855 4,873 4,892 4,911 4,932 4,953 4,978* Outs tanding Balanc e 96,768 97,106 97,461 97,834 98,226 98,637 99,069 99,522 100,000 3,232 *rounded 2. Cas h Pay ment 4.5% × Fac e Amount 1 2 3 4 5 6 7 8 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 Rec orded Interes t Cas h plus Dis c ount Reduc tion...
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This homework help was uploaded on 03/22/2014 for the course ACC 3000 taught by Professor He during the Fall '09 term at CUNY Baruch.

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