On SEPTEMBER 30,2011,Ace Electronics issued $100,000 of 10-year,8% bonds at 100.The bonds pay interest semiannually on September 30 and March 31.These bonds sold at 100,which is ________.

Question

Quizplus · Accepted Answer

The fact that the bonds were sold at 100 indicates that they are being sold at par value, which means the market rate of interest is the same as the stated 8% interest rate. If the market rate had been higher or lower than 8%, the bonds would have sold at a premium or discount, respectively.

On SEPTEMBER 30,2011,Ace Electronics Issued $100,000 of 10-Year,8% Bonds at 100.The