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13 August, 18:39

If $1,004,000 of 10% bonds are issued at 102 3/4, the amount of cash received from the sale is a.$1,004,000 b.$753,000 c.$1,104,400 d.$1,031,610

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  1. 13 August, 20:27
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    d.$1,031,610

    Explanation:

    Data provided in the question

    Bond interest rate = 10%

    Issued price = $102.75

    Value of the bond = $1,004,000

    So by considering the above information, the amount of cash received from the sale is

    = Value of the bond * (Issue price of bond : Face Value of Bond)

    = $1,004,000 * ($102.75 : 100)

    = $1,031,610

    The bond interest rate is ignored in this question
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