Blanding Company Issues $1,000,000 of 8%,10-Year Bonds at 98 on February

question 34

Multiple Choice

Blanding Company issues $1,000,000 of 8%,10-year bonds at 98 on February 28,2012.The bond pays interest on February 28 and August 31.The market rate of interest on the issuance date was 10%.On August 31,2012,how much cash did Blanding pay out to bondholders?

• A) $41,000
• B) $40,000
• C) $80,000
• D) $39,000