When the market rate of interest was 12%, Halprin Corporation issued $1,000,000, 11%, 10-year bonds that pay interest annually. The selling price of this bond issue was _____. Use the following tables, if needed. Present Value of $1 at Compound Interest Periods 5% 6% 7% 10% 12% 1 0.95238 0.94340 0.93458 0.90909 0.89286 2 0.90703 0.89000 0.87344 0.82645 0.79719 3 0.86384 0.83962 0.81630 0.75132 0.71178 4 0.82270 0.79209 0.76290 0.68301 0.63552 5 0.78353 0.74726 0.71299 0.62092 0.56743 6 0.74622 0.70496 0.66634 0.56447 0.50663 7 0.71068 0.66506 0.62275 0.51316 0.45235 8 0.67684 0.62741 0.58201 0.46651 0.40388 9 0.64461 0.59190 0.54393 0.42410 0.36061 10 0.61391 0.55840 0.50835 0.38554 0.32197
When the market rate of interest was 12%, Halprin Corporation issued $1,000,000, 11%, 10-year bonds that pay interest annually. The selling price of this bond issue was _____. Use the following tables, if needed. Present Value of $1 at Compound Interest Periods 5% 6% 7% 10% 12% 1 0.95238 0.94340 0.93458 0.90909 0.89286 2 0.90703 0.89000 0.87344 0.82645 0.79719 3 0.86384 0.83962 0.81630 0.75132 0.71178 4 0.82270 0.79209 0.76290 0.68301 0.63552 5 0.78353 0.74726 0.71299 0.62092 0.56743 6 0.74622 0.70496 0.66634 0.56447 0.50663 7 0.71068 0.66506 0.62275 0.51316 0.45235 8 0.67684 0.62741 0.58201 0.46651 0.40388 9 0.64461 0.59190 0.54393 0.42410 0.36061 10 0.61391 0.55840 0.50835 0.38554 0.32197
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
When the market rate of interest was 12%, Halprin Corporation issued $1,000,000, 11%, 10-year bonds that pay interest annually. The selling price of this bond issue was _____. Use the following tables, if needed.
Present Value of $1 at Compound Interest
| Periods | 5% | 6% | 7% | 10% | 12% |
| 1 | 0.95238 | 0.94340 | 0.93458 | 0.90909 | 0.89286 |
| 2 | 0.90703 | 0.89000 | 0.87344 | 0.82645 | 0.79719 |
| 3 | 0.86384 | 0.83962 | 0.81630 | 0.75132 | 0.71178 |
| 4 | 0.82270 | 0.79209 | 0.76290 | 0.68301 | 0.63552 |
| 5 | 0.78353 | 0.74726 | 0.71299 | 0.62092 | 0.56743 |
| 6 | 0.74622 | 0.70496 | 0.66634 | 0.56447 | 0.50663 |
| 7 | 0.71068 | 0.66506 | 0.62275 | 0.51316 | 0.45235 |
| 8 | 0.67684 | 0.62741 | 0.58201 | 0.46651 | 0.40388 |
| 9 | 0.64461 | 0.59190 | 0.54393 | 0.42410 | 0.36061 |
| 10 | 0.61391 | 0.55840 | 0.50835 | 0.38554 | 0.32197 |
Present Value of an Annuity of $1 at Compound Interest
| Periods | 5% | 6% | 7% | 10% | 12% |
| 1 | 0.95238 | 0.94340 | 0.93458 | 0.90909 | 0.89286 |
| 2 | 1.85941 | 1.83339 | 1.80802 | 1.73554 | 1.69005 |
| 3 | 2.72325 | 2.67301 | 2.62432 | 2.48685 | 2.40183 |
| 4 | 3.54595 | 3.46511 | 3.38721 | 3.16987 | 3.03735 |
| 5 | 4.32948 | 4.21236 | 4.10020 | 3.79079 | 3.60478 |
| 6 | 5.07569 | 4.91732 | 4.76654 | 4.35526 | 4.11141 |
| 7 | 5.78637 | 5.58238 | 5.38929 | 4.86842 | 4.56376 |
| 8 | 6.46321 | 6.20979 | 5.97130 | 5.33493 | 4.96764 |
| 9 | 7.10782 | 6.80169 | 6.51523 | 5.75902 | 5.32825 |
| 10 | 7.72173 | 7.36009 | 7.02358 | 6.14457 | 5.65022 |
a.$621,524
b.$321,970
c.$943,494
d.$1,000,000
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