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On January 1, 2021, Cheyenne Co. issued ten-year bonds with a face value of $4,700,000 and a

On January 1, 2021, Cheyenne Co. issued ten-year bonds with a face value of $4,700,000 and a

On January 1, 2021, Cheyenne Co. issued ten-year bonds with a face value of $4,700,000 and a stated interest rate of 10%, payable semiannually on June 30 and December 31. The bonds were sold to yield 12%. Table values are:

Present value of 1 for 10 periods at 10%

0.386

Present value of 1 for 10 periods at 12%

0.322

Present value of 1 for 20 periods at 5%

0.377

Present value of 1 for 20 periods at 6%

0.312

Present value of annuity for 10 periods at 10%

6.145

Present value of annuity for 10 periods at 12%

5.650

Present value of annuity for 20 periods at 5%

12.462

Present value of annuity for 20 periods at 6%

11.470

 

 

Calculate the issue price of the bonds.

Issue price of bond
$

 
manish jayant 10-Sep-2020

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