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What the life of the bonds is

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Problem 1: On January 1 of Year 1, Congo Express Airways issued $5,200,000 of 7%, bonds that pay interest semiannually on January 1 and July 1. The bond issue price is $4,836,000 and the market rate of interest for similar bonds is 9%. The bond premium or discount is being amortized using the straight-line method at a rate of $13,000 every 6 months. The life of these bonds is:

Multiple Choice

Option 1: 28 years.

Option 2: 40 years.

Option 3: 37 years

Option 4: 11 years.

Option 5: 14 years.

Reference no: EM132674090

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