Chapter 8
Non-Current Liabilities
416
AP-9B (
2
3
4
)
A company issued $1,200,000 worth of 15-year bonds with a 3% interest rate. Interest is to
be paid annually. The bond issue date is January 1, 2016 and the company has a year-end of
December 31.
Required
a) Calculate the bond issue price under each market interest rate.
Market Interest Rate
Bond Price
2%
3%
4%
