In Its 2016 Annual Report to Shareholders,Bare Sturns Group Inc

In its 2016 annual report to shareholders,Bare Sturns Group Inc.disclosed the following:
On October 28,2016,the Company issued $475,000,000 aggregate principal amount of 9-1/4% Senior Notes Due 2021 ("Senior Notes")and $618,670,000 aggregate principal amount at maturity of 10-1/4% Senior Discount Notes Due 2021 ("Senior Discount Notes" and collectively the "Notes")in a transaction not registered under the Securities Act in reliance upon an exemption from the registration requirements of the Securities Act.Gross proceeds from the offering amounted to $850,000,000.The discount on the Senior Discount Notes is being accreted under the effective interest method.
Explain the last sentence of the disclosure to clarify what accounting was necessary and why.

Correct Answer:

Verified

Bare Sturns received only $850 million f...

View Answer

Unlock this answer now
Get Access to more Verified Answers free of charge

View Full Answer For Free