Question

A company issues at par 9% bonds with a par value of $100,000 on April 1. The bonds pay interest semi-annually on January 1 and July 1. How much total cash interest is received on July 1 by the bond holder?

Answer 1

$ 4,500.00

Step-by-step explanation:

The bond per value = $ 100,000.00

Interest = 9 %

Interest is paid semi annually.

Each interest payment will be

=(9/100x$100,000)/2

=$9000/2

=$ 4,500.00