Demonstrate the selling price of the bond is the

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Problem 1: On January 1, 2020, ABC, Inc. issued 500, $1,000 bonds. The bonds are 5-year, 6% bonds that pay interest on December 31 each year. When issued, investors required 4% interest and the bonds are due December 31, 2024. The selling price of this bond is the ________.

Group of answer choices

Option 1: Present value of $500,000 par value plus the present value of the $20,000 interest payments

Option 2: Present value of $500,000 par value plus the present value of the $30,000 interest payments

Option 3: $500,000 par value of the bond plus the present value of the $30,000 interest payments

Option 4: Present value of $500,000 par value minus the present value of the $20,000 interest payments

Reference no: EM132670190

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