Question # 1 (Max. Marks=5= 2 +2+1) Information: Networks Corp., a hypothetical company, issues 4-year bonds of worth $10 million on 1-Jan-2000 when the market interest rate is 4% per annum. The bonds pay an annual coupon of 5% on 31- December for each year until maturity of the bonds. Required: (1) What are the sales proceeds of the bonds when issued? (2) How is the issuance of bonds reflected in the financial statements? (3) Is it a premium or discount bond? Why? Answer:

"Get 15% discount on your first 3 orders with us"
Use the following coupon
"FIRST15"

Order Now