The following terms relate to independent bond issues: 530 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments 530 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments 780 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments 2,070 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments Use the appropriate present value table: PV of $1 and PV of Annuity of $1 Required: Assuming the market rate of interest is 10%, calculate the selling price for each bond issue. If required, round your intermediate calculations and final answers to the nearest dollar. Situation Selling Price of the Bond Issue a. $fill in the blank 1 b. $fill in the blank 2 c. $fill in the blank 3 d. $fill in the blank 4
The following terms relate to independent bond issues: 530 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments 530 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments 780 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments 2,070 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments Use the appropriate present value table: PV of $1 and PV of Annuity of $1 Required: Assuming the market rate of interest is 10%, calculate the selling price for each bond issue. If required, round your intermediate calculations and final answers to the nearest dollar. Situation Selling Price of the Bond Issue a. $fill in the blank 1 b. $fill in the blank 2 c. $fill in the blank 3 d. $fill in the blank 4
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Issue Price
The following terms relate to independent bond issues:
- 530 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments
- 530 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments
- 780 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments
- 2,070 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments
Use the appropriate present value table:
PV of $1 and PV of Annuity of $1
Required:
Assuming the market rate of interest is 10%, calculate the selling price for each bond issue. If required, round your intermediate calculations and final answers to the nearest dollar.
| Situation | Selling Price of the Bond Issue |
| a. | $fill in the blank 1 |
| b. | $fill in the blank 2 |
| c. | $fill in the blank 3 |
| d. | $fill in the blank 4 |
Transcribed Image Text:TABLE 9-2 Present Value of $1
(N)
Periods
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
22
24
26
28
30
2%
98039
96117
94232
92385
90573
.88797
.87056
.85349
83676
.82035
.80426
78849
.77303
.75788
74301
.72845
.71416
70016
.68643
.67297
.64684
.62172
59758
57437
55207
3%
97087
94260
91514
88849
.86261
.83748
.81309
78941
76642
74409
.72242
70138
.68095
.66112
.64186
.62317
.60502
58739
57029
55368
52189
49193
46369
43708
41199
4%
96154
92456
.88900
.85480
.82193
.79031
.75992
.73069
.70259
.67556
.64958
.62480
.60057
57748
55526
53391
51337
49363
47464
45639
42196
39012
36069
33348
30832
5%
95238
90703
86384
.82270
78353
.74622
.71068
.67684
.64461
.61391
58468
55684
53032
50507
48102
45811
43630
41552
39573
37689
34185
31007
28124
25509
23138
6%
94340
89000
.83962
.79209
.74726
.70496
.66506
.62741
59190
55839
52679
49697
46884
44230
41727
39365
37136
35034
33051
31180
27751
24698
21981
.19583
.17411
7%
.93458
.87344
.81630
.76290
.71299
.66634
.62275
.58201
.54393
.50835
47509
.44401
.41496
.38782
.36245
.33873
.31657
29586
.27651
25842
.22571
.19715
17220
.15040
.13137
8%
.92593
.85734
.79383
73503
.68058
.63017
.58349
.54027
50025
.46319
.42888
.39711
.36770
.34046
.31524
.29189
27027
.25025
.23171
21455
.18394
.15770
.13520
.11591
.09938
10%
.90909
.82645
.75131
.68301
.62092
.56447
51316
.46651
.42410
.38554
35049
.31863
.28966
26333
23939
.21763
.19784
.17986
.16351
.14864
.12285
.10153
.08391
.06934
.05731
12%
.89286
.79719
.71178
.63552
.56743
.50663
.45235
.40388
.36061
.32197
28748
.25668
22917
.20462
.18270
.16312
.14564
.13004
.11611
.10367
.08264
.06588
05252
.04187
03338
15%
.86957
.75614
.65752
57175
49718
43233
37594
32690
28426
24718
21494
.18691
16253
.14133
.12289
.10686
09293
08081
07027
.06110
04620
03493
02642
.01997
01510
Transcribed Image Text:TABLE 9-4 Present Value of Annuity of $1
(N)
Periods
1
2
3
4
5
6
7
8
9
1123
10
13
14
15
16 17
17
18
19
20
22
24
26
28
30
2%
98039
97087
.90909
.89286
1.94156
1.91347
1.73554 1.69005
2.88388 2.82861
2.57710 2.48685
2.40183
3.71710
3.31213 3.16987
3.03735
3.80773
4.71346 4.57971
3.54595 3.46511
4.21236
3.38721
4.10020
3.99271 3.79076 3.60478
5.60143
5.07569 4.91732
4.62288 4.35526
4.11141
6.47199
5.78637 5.58238
4.76654
5.38929
5.97130
5.20637 4.86842
4.56376
6.46321
6.20979
5.74664 5.33493
4.96764
7.32548
8.16224 7.78611
7.10782
6.80169
6.51523
6.24689 5.75902
5.32825
8.11090 7.72173
7.36009
7.02358 6.71008 6.14457 5.65022
7.49867 7.13896 6.49506 5.93770
8.98259 8.53020
9.78685 9.25262 8.76048 8.30641 7.88687
10.57534 9.95400 9.38507 8.86325
11.34837 10.63496 9.98565
11.29607 10.56312
8.38384
7.94269
6.81369
6.19437
7.53608
7.90378 7.10336
9.39357
8.85268
8.35765
6.42355
12.10625
9.89864
9.29498
8.74547
7.36669 6.62817
8.24424
8.55948
12.84926
7.60608 6.81086
13.57771
8.85137 7.82371
6.97399
11.93794 11.11839 10.37966
12.56110 11.65230
14.29187 13.16612 12.16567 11.27407
13.75351
10.83777 10.10590
10.47726
9.12164 8.02155
7.11963
14.99203
12.65930
11.68959 10.82760
9.37189 8.20141
7.24967
15.67846
8.36492
7.36578
9.71225 9.10791
9.44665
9.76322
10.05909
14.32380 13.13394 12.08532 11.15812 10.33560
14.87747 13.59033 12.46221 11.46992 10.59401
17.65805 15.93692 14.45112 13.16300 12.04158 11.06124 10.20074
18.91393 16.93554 15.24696 13.79864 12.55036 11.46933 10.52876
20.12104 17.87684 15.98277 14.37519 13.00317 11.82578 10.80998 9.16095 7.89566
21.28127 18.76411 16.66306 14.89813 13.40616 12.13711 11.05108 9.30657
22.39646 19.60044 17.29203 15.37245
9.60360
9.81815 8.51356
16.35143
7.46944
8.77154 7.64465
8.98474 7.78432
7.98442
13.76483 12.40904 11.25778 9.42691
8.05518
3%
4%
5%
96154
95238
1.88609
1.85941
2.77509 2.72325
3.62990
4.45182 4.32948
5.41719 5.24214
6.23028 6.00205
7.01969 6.73274
7.43533
6%
7%
8%
.94340
.92593
.93458
1.83339 1.80802 1.78326
2.67301 2.62432
10%
12%
15%
86957
1.62571
2.28323
2.85498
3.35216
3.78448
4.16042
4.48732
4.77158
5.01877
5.23371
5.42062
5.58315
5.72448
5.84737
5.95423
6.04716
6.12797
6.19823
6.25933
6.35866
6.43377
6.49056
6.53351
6.56598
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