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Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094

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BuyFindarrow_forward

Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094
Textbook Problem

Bond price

Stone Energy Corporation's 7.5% bonds due in 2022 were reported as selling for 82.95.

Were the bonds selling at a premium or at a discount? Why is Stone Energy Corporation able to sell its bonds at this price?

To determine

Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.

Discount on bonds: It occurs when the bonds are issued at a low price than the face value.

To identify: The selling price of bonds

Explanation

The bonds were selling at discount.

The stated percentage of th...

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