A 10-Year Bond Issue with a $100,000 Par Value, 8

question 3

True/False

A 10-year bond issue with a $100,000 par value, 8% annual contract rate, with interest payable semiannually means that the issuer must repay $100,000 at the end of 10 years and make 20 semiannual interest payments of $4,000 each.

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Definitions:

Merchandise

Goods that are bought and sold in any business, particularly in retail.

Freight Charge

The cost incurred for transporting goods between places, typically charged by carriers for shipments.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue; also known as net earnings or net profit.

Sales Discounts

Reductions in the price of a product or service offered to incentivize prompt payment by the customer.