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- A company issued bonds with a $100,000 face value, a 5-year term, a stated rate of 6%, and a market rate of 7%. Interest is paid annually. What is the amount of interest the bondholders will receive at the end of the year?ABC will be issuing a non- interest-bearing bond that has a face value of P10,000,000, term of 5 years, and net proceeds of P6,375,000. 2. How much is the effective cost of the bonds?Bond Z pays $98 annual interest and has a market value of $870. It has five years to maturity. Assume the par value of the bonds is $1,000. Approximate Yield to Maturity? Exact Yield to Materity?
- Bond Issuance. Sander Corporation issues a P300,000, 16 percent, 10-year bond at 108. REQUIREMENTS: (a) What is the maturity value? (b) What is the annual cash interest payment? (c) What are the proceeds the company receives upon issuance of the bond? (d) What is the amount of the premium? (e) What is the annual premium amortization?A bond pays $50,000 per year and has a face value of $500,000 at theend of 8 years when it has to be redeemed. If its current discounted priceis $390,000, what true interest could be earned on the bond? Ans. (14.9%)2. DEF Company will issue $8,000,000 in 10%, 10-year bonds when the market rate of interest is 7%. Interest is paid semiannually. Required: a. Will this interest structure result in a Premium for DEF company or a Discount? b. How much cash will be received from the issuance of the bond? c. How much will the semi-annual interest payment be on the bond?
- A one-year premium bond with a face value of $10,000 has been purchased for $11,150. What is the yield to maturity? What is the yield on a discount basis?What is the present value of a 10-year bond outstanding with 8 years left in “year-to-maturity,” 6% annual required rate, and 4% annual payment rate?Use the following tables to calculate the present value of a $130,000, 5%, 6-year bond that pays $6,500 ($130,000 × 5%) interest annually, if the market rate of interest is 6%. Present Value of $1 at Compound Interest Periods 5% 6% 7% 10% 1 0.95238 0.94340 0.93458 0.90909 2 0.90703 0.89000 0.87344 0.82645 3 0.86384 0.83962 0.81630 0.75131 4 0.82270 0.79209 0.76290 0.68301 5 0.78353 0.74726 0.71299 0.62092 6 0.74622 0.70496 0.66634 0.56447 7 0.71068 0.66506 0.62275 0.51316 8 0.67684 0.62741 0.58201 0.46651 9 0.64461 0.59190 0.54393 0.42410 10 0.61391 0.55839 0.50835 0.38554 Present Value of Annuity of $1 at Compound Interest Periods 5% 6% 7% 10% 1 0.95238 0.94340 0.93458 0.90909 2 1.85941 1.83339 1.80802 1.73554 3 2.72325 2.67301 2.62432 2.48685 4 3.54595 3.46511 3.38721 3.16987 5 4.32948…
- A 50,000$ bond has a maturity date of 6 years. the bond interest rate is 6% per annum payable semi-annually. At a market interest rate of 4% per annum payable semi-annually, the present value of the bond is approximately: exact value please!Determine the market price of a $485,000, 10-year, 8% (pays interest semiannually) bond issue sold to yield an effective rate of 10%. What is the market price?Use the following tables to calculate the present value of a $515,000, 5%, 5-year bond that pays $25,750 ($515,000 × 5%) interest annually, if the market rate of interest is 10%. Present Value of $1 at Compound Interest Periods 5% 6% 7% 10% 1 0.95238 0.94340 0.93458 0.90909 2 0.90703 0.89000 0.87344 0.82645 3 0.86384 0.83962 0.81630 0.75131 4 0.82270 0.79209 0.76290 0.68301 5 0.78353 0.74726 0.71299 0.62092 6 0.74622 0.70496 0.66634 0.56447 7 0.71068 0.66506 0.62275 0.51316 8 0.67684 0.62741 0.58201 0.46651 9 0.64461 0.59190 0.54393 0.42410 10 0.61391 0.55839 0.50835 0.38554 Present Value of Annuity of $1 at Compound Interest Periods 5% 6% 7% 10% 1 0.95238 0.94340 0.93458 0.90909 2 1.85941 1.83339 1.80802 1.73554 3 2.72325 2.67301 2.62432 3.16987 4 3.54595 3.46511 3.38721 3.16987 5 4.32948 4.21236 4.10020 3.79079 6 5.07569 4.91732 4.76654 4.35526 7 5.78637 5.58238 5.38929 4.86845 8 6.46321 6.20979 5.97130 5.33493 9 7.10782…
