On January 2, 2015, Hi-Tech Master Construction, Inc issued $500,000, 10-year bonds for $574,540 . The bonds pay interest on June 30 and December 31 . The face rate is 8% and the market rate is 6%. The annual cash payment (paid in semiannual payments) on the bonds is
a. $40,000 .
b. $30,000 .
c. $20,000 .
d. $15,000.
a
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The pound shows a forward premium against the dollar (the forward rate is greater than the spot rate) when
a. interest rates in the United Kingdom are higher than those in the United States. b. interest rates in the United Kingdom are lower than those in the United States. c. real GDP is higher in the United Kingdom than in the United States. d. real GDP is lower in the United Kingdom than in the United States.
If interest rates in the U.K. are higher than those in the United States, then the pound shows a forward discount, which means the forward rate is less than the spot rate.
a. True b. False
Which of the following is TRUE of outputs in an accounting information system?
A) In a manual system, reports and financial statements can be created using Word documents, Excel spreadsheets, or PowerPoint. B) In a computerized system, the software can generate reports instantaneously that cannot be formatted. C) Examples of outputs in an accounting information system include purchase invoices, bank checks, and sales invoices. D) Since the output in an accounting information system is audited and error-free, it provides the evidence and data for accounting transactions.
According to Ansoff’s matrix, a company that tries to increase sales by selling its existing products in a new market is following what kind of strategy?
a. market development b. diversification c. focus d. market penetration e. product development