The Issue Price of Each $1,000 Bond That Pays Interest

question 176

Multiple Choice

The issue price of each $1,000 bond that pays interest at 5% and has a bond price of 102.10 equals:

• A)$1,021.
• B)$1,050.
• C)$950.
• D)$1,000.

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Definitions:

Normal Balance

The side (debit or credit) of an account that is expected to have a higher balance, according to the rules of double-entry accounting.

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities on a company's balance sheet.

Credit

An arrangement whereby goods, services, or money is received in exchange for a promise to pay back a definite sum of money at a future date.

Supplies

Items used in the operations of a business, often consumable, such as office supplies or factory supplies, not directly part of the finished product.