Buzz Corporation issued $50,000 worth of 10-year,8% bonds for $48,359.66.The $50,000 is called the ________.

Name: Buzz Corporation issued $50,000 worth of 10-year,8% bonds for $48,359.66.The $50,000 is called the ________.
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Question

Quizplus · Accepted Answer

The $50,000 is called the face value, which is the amount that will be paid back at maturity of the bonds. The market value is the amount actually paid for the bonds, which in this case was $48,359.66. The future value and stated rate are not relevant to this situation.

Buzz Corporation Issued $50,000 Worth of 10-Year,8% Bonds for $48,359