Matthew Company issued 10-year, 7% bonds (paying semiannual interest) with a par value of $100,000. The market rate of interest when the bonds were issued was 6%. Compute the price of the bonds when they were issued.
A) $107,360.70
B) $93,206.05
C) $107,441.25
D) $93,290.70
E) $107,018.80
Answer: C) $107,441.25
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A. up-front B. scatter C. spot D. local E. interconnected
Utah Co sold merchandise to Big Sky Corp on December 1, 2016, for $9,000, and accepted a promissory note for payment in the same amount. The note has a term of 90 days and a stated interest rate of 8%. Utah's accounting period ends on December 31 . What amount should Utah recognize as interest revenue on December 31, 2016 (if a 360 day year is assumed)?
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B) $177,500
C) $19,500
D) $201,000
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