A 7 Percent Coupon Bond Has a Face Value of $1,000

question 85

Multiple Choice

A 7 percent coupon bond has a face value of $1,000 and pays interest annually.The current yield is 6.8 percent.What is the current price of this bond?

• A) $971.43
• B) $978.41
• C) $1,068.00
• D) $1,029.41
• E) $1,104.00

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Definitions:

Perpetual System

An inventory management method where inventory quantities and cost of goods sold are updated continuously with each sale or purchase.

Periodic System

A method of inventory valuation for financial reporting purposes where a physical count of the inventory is performed at specific intervals to determine the ending inventory balance and the cost of goods sold.

Merchandise Inventory

Goods or products that a retail or wholesale company holds for the purpose of selling them to customers.

Goods On Consignment

Merchandise that is sent to a retailer by the vendor to be sold but remains the property of the vendor until sold.