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$2.99 Limeway Company issues $5,000,000, 6%, 5-year bonds dated January 1, 2007

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Chapter 1, # 0
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MasterOfThePhoenix
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Q:

Limeway Company issues $5,000,000, 6%, 5-year bonds dated January 1, 2007, on January 1, 2007. The bonds pay interest semiannually on June 30 and December 31. The bonds are issued to yield 5%. What are the proceeds from the bond issue?

                                2.5%      3.0%      5.0%      6.0%

Present value of a single sum for 5 periods          .88385   .88261   .78353   .74726

Present value of a single sum for 10 periods        .78120   .74409   .61391   .55839

Present value of an annuity for 5 periods              4.64583 4.57971 4.32948 4.21236

Present value of an annuity for 10 periods           8.75206 8.53020 7.72173 7.36009

               

 

                A.   $5,216,494

                B.   $5,217,308

                C.   $5,000,000

                D.   $5,218,809

 

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Limeway Company issues $5,000,000, 6%, 5-year bonds dated January 1, 2007
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