Crane Company issues $24000000, 4%, 5-year bonds dated January 1, 2020 on January 1, 2020. The bonds pay interest semiannually on June 30 and December 31. The bonds are issued to yield 3%. What are the proceeds from the bond issue? 1.5% 2.0% 3% 4% Present value of a single sum for 5 0.92826 0.90573 0.86261 0.82193 periods Present value of a single sum for 10 0.86167 0.82035 0.74409 0.67556 periods Present value of an annuity for 5 4.78264 4.71346 4.57971 4.45182 periods Present value of an annuity for 10 9.22218 8.98259 8.53020 8.11090 periods O $24000000 O $25099221 O $25106726 O $25095151
Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
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