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On May 1, Romo Corp

Question 42

Multiple Choice

On May 1, Romo Corp. issued $600,000, 8%, 10-year bonds. Interest is payable semi-annually on January 1 and July 1. Proceeds from the issue amounted to $616,000. An explanation of the selling price of the bonds is that they were sold at


A) a discount.
B) a premium.
C) face plus accrued interest.
D) a higher effective interest rate.
E) b or c.

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