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    Premium / Discount on bonds

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    Swanson Inc. purchased $400,000 of Malone Corp. ten-year bonds with a stated interest rate of 8 percent payable quarterly. At the time the bonds were purchased, the market interest rate was 12 percent. Determine the amount of premium or discount on the purchase of the bonds.

    a. $92,442 premium
    b. $92,442 discount
    c. $81,143 premium
    d. $81,143 discount

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    Swanson Inc. purchased $400,000 of Malone Corp. ten-year bonds with a stated interest rate of 8 percent payable quarterly.  At the time the bonds were purchased, the market interest rate was 12 percent.  Determine the amount of premium or discount on the purchase of the bonds.

    a. $92,442 premium
    b. $92,442 discount
    c. $81,143 premium
    d. ...

    Solution Summary

    Calculates Premium / Discount on bonds.

    $2.49

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