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3 October, 16:00

On January 1, Year 1, Boston Group issued $100,000 par value, 5% 5-year bonds when the market rate of interest was 8%. Interest is payable annually on December 31. The following present value information is available:

5%, 8%

Present value of $1 (n = 5) 0.78353, 0.68058

Present value of an ordinary annuity (n = 5) 4.32948, 3.99271

What amount is the value of net bonds payable at the end of Year 1?

A. $110,638

B. $100,000

C. $88,022

D. $90,064

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Answers (1)
  1. 3 October, 18:02
    0
    Would have to say the answer is B
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