A 5% Debenture (Face Value = $1000) Pays Interest on June

question 93

Multiple Choice

A 5% debenture (face value = $1000) pays interest on June 30 and December 31. It is callable at a price of 105% together with accrued interest. Suppose the company decides to call the bonds on September 30. What price must it pay for each bond?

• A) $1000.00
• B) $1037.50
• C) $1062.50
• D) $1050.00

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