Reynolds co issued 72 million face amount of 1075 bonds

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Reference no: EM13588555

Reynolds Co. issued $72 million face amount of 10.75% bonds when market interest rates were 11.10% for bonds of similar risk and other characteristics.

Required:

a.How much interest will be paid annually on these bonds? (Enter your answer in dollars, not millions of dollars, i.e. 1,234,567.)

b. Were the bonds issued at a psaremium or discount?

c.Will the annual interest expense on these bonds be more than, equal to, or less than the amount of interest paid each year?

Reference no: EM13588555

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