Seaside issues a bond that has a stated interest rate of 12%, face amount of $40,000, and is due in 8 years. Interest payments are made semi-annually. The market rate for this type of bond is 14%. What is the issue price of the bond?

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
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Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 6MC: On July 1, a company sells 8-year $250,000 bonds with a stated interest rate of 6%. If interest...
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Seaside issues a bond that has a stated interest rate of 12%, face amount of $40,000, and is due in 8 years. Interest payments are made semi-annually. The market rate for this type of bond is 14%. What is the issue price of the bond?

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