On January 1, 2024, Water World Issues $24.8 million of 6% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. Water World Intends to use the funds to build the world's largest water avalanche and the "tornado"--a giant outdoor vortex in which riders spin in progressively smaller and faster circles until they drop through a small tunnel at the bottom. Exercise 9-22 (Algo) Part 3 3-a. If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) 3-b. Will the bonds issue at face amount, a discount, or a premium? Answer is not complete. Complete this question by entering your answers in the tabs below. Req 3a Req 3b If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Note: Use tables, Excel, or a financial calculator. Enter your answers in dollars not in millions (i.e., $5.5 million should be entered as 5,500,000). Round your final answers to the nearest whole dollar.) Bond Characteristics Amount Face amount $ 24,800,000 Interest payment $ 744,000 Number of periods 40 Market interest rate 3.5% Issue price $ 26,435,893x
On January 1, 2024, Water World Issues $24.8 million of 6% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. Water World Intends to use the funds to build the world's largest water avalanche and the "tornado"--a giant outdoor vortex in which riders spin in progressively smaller and faster circles until they drop through a small tunnel at the bottom. Exercise 9-22 (Algo) Part 3 3-a. If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) 3-b. Will the bonds issue at face amount, a discount, or a premium? Answer is not complete. Complete this question by entering your answers in the tabs below. Req 3a Req 3b If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Note: Use tables, Excel, or a financial calculator. Enter your answers in dollars not in millions (i.e., $5.5 million should be entered as 5,500,000). Round your final answers to the nearest whole dollar.) Bond Characteristics Amount Face amount $ 24,800,000 Interest payment $ 744,000 Number of periods 40 Market interest rate 3.5% Issue price $ 26,435,893x
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:On January 1, 2024, Water World Issues $24.8 million of 6% bonds, due in 20 years, with interest payable semiannually on
June 30 and December 31 each year. Water World Intends to use the funds to build the world's largest water avalanche
and the "tornado"--a giant outdoor vortex in which riders spin in progressively smaller and faster circles until they drop
through a small tunnel at the bottom.
Exercise 9-22 (Algo) Part 3
3-a. If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1)
3-b. Will the bonds issue at face amount, a discount, or a premium?
Answer is not complete.
Complete this question by entering your answers in the tabs below.
Req 3a
Req 3b
If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Note: Use tables, Excel,
or a financial calculator. Enter your answers in dollars not in millions (i.e., $5.5 million should be entered as 5,500,000). Round
your final answers to the nearest whole dollar.)
Bond Characteristics
Amount
Face amount
$
24,800,000
Interest payment
$
744,000
Number of periods
40
Market interest rate
3.5%
Issue price
$
26,435,893x
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