The prepaid insurance account had a balance of $3,000 at the beginning of the year. the account was debited for $32,500 for premiums on policies purchased during the year.journalize the adjusting entry required under each of the following alternatives for determining the amount of the adjustment: (a) the amount of unexpired insurance applicable to future periods is $4,800; (b) the amount of insurance expired during the year is $30,700

The present value of the bond is $747.25

Explanation:

In order to find the present value of a bond we need to know its future value, its years to maturity, its yield to maturity and its payments. The question tells us that is a discount bond which means it has 0 payments and it tells us the other 3 variables. We will put these variables in a financial calculator in order to find the present value.

FV= 1000

N=5

PMT=0

I=6

Compute present value =747.25