Use the Following Bond Quotes to Answer This Question

question 35

Multiple Choice

Use the following bond quotes to answer this question:

-The Alpha Industrial bonds pay an annual interest payment equal to 5.875 percent of:

• A) $999.90.
• B) $1,000.00.
• C) $1,000.13.
• D) $1,033.54.
• E) $1,034.07.

---

Definitions:

Company

A legal entity formed by individuals, stockholders, or shareholders, with the purpose of operating for profit, engaging in commercial and industrial activities.

Straight-Line Amortization

A method of allocating the cost of an intangible asset evenly over its useful life.

Bond Payable

A long-term liability account that represents the amount a company owes to bondholders, to be repaid at a future date.

Issue Price

The issue price is the price at which a company's securities, such as stocks or bonds, are first offered for sale to the public when they are issued.