On January 1,2009,Jason Company Issued $5 Million of 10-Year Bonds

Multiple Choice

On January 1,2009,Jason Company issued $5 million of 10-year bonds at a 10% stated interest rate to be paid annually.The following present value factors have been provided:

$$\begin{array}{ll }\begin{array} { ll } \text { Time Period } & \text { Interest } \\10 & 10 \% \\10 & 8 \% \\10 & 12 \%\end{array}\begin{array} { l l } \text { PV of } \$ 1 & \text { PV of a } \$ 1 \text { Annuity } \\.386 & 6.145 \\.463 & 6.710 \\.322 & 5.650\end{array}\end{array}$$
What was the issuance price of the bonds if the market rate of interest was 8%?

A) $5,000,000
B) $5,670,000
C) $5,387,500
D) $5,712,500