If $2,000,000 of 10% bonds are issued at 97, the amount of cash received from the sale is
A) $2,060,000
B) $2,000,000
C) $2,100,000
D) $1,940,000

Question

Quizplus · Accepted Answer

To find the amount of cash received from the sale of bonds, we need to multiply the number of bonds issued by the issue price.

Number of bonds issued = $2,000,000 / $1,000 per bond = 2,000 bonds.

Issue price = 97% of $1,000 = $970 per bond.

Cash received = 2,000 bonds x $970 per bond = $1,940,000.

Therefore, the correct choice is D.

If $2,000,000 of 10% Bonds Are Issued at 97, the Amount