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Financial Accounting

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Disposal on Maturity Date

FINACT-X9ZGQM

Your company is thinking about issuing a 10-year, \$5,000,000 bond on 1/1/2016 with a stated interest rate of 5%. Your company will pay interest every year on 1/1 beginning on 1/1/2017. You are in the process of planning the cash outflows you will need for this bond.

What is the total amount of cash your company needs to pay (in dollars) on the maturity date (1/1/2026)?

A

250000

B

5000000

C

5250000

D

None of the above