Use the Information Below for Fargo Corp

question 206

Multiple Choice

Use the information below for Fargo Corp. for 2015 and 2016 to answer the following question. At the end of 2016, Fargo issued bonds at par value for $800,000 cash. The proceeds from these bonds were used to retire the $500,000 bond issue outstanding at the end of 2015 before their maturity date. All interest expense was paid in cash during 2016.
How much did Fargo pay to retire the $500,000 bond issue during 2016?

• A) $485,000
• B) $500,000
• C) $515,000
• D) $560,000

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Definitions:

Buyer's Damages

Legal compensation sought by a purchaser when a seller fails to fulfill the terms of a contract, such as defects in goods or delays in delivery.

Defective Goods

Products that fail to meet quality or performance standards, often leading to consumer dissatisfaction or safety concerns.

Industry Value

The total market worth of a specific sector or industry, often calculated by combining the value of all involved companies and sales.

UCC Statute of Limitations

The time limit established by the Uniform Commercial Code within which a lawsuit must be filed to resolve various types of disputes, notably in commercial transactions.