Issuance Price of Bonds
Patterson Company issued 30-year bonds on June 30. The face value of the bonds was
$750,000. The stated interest rate on the bonds was 6%. The market rate of interest at the
time of issuance was 4%. Patterson also issued another set of bonds on August 31. These
bonds were 20-year bonds and had a face value of $556,000. The stated rate of interest on
these bonds was 5%. The market rate of interest at the time these bonds were issued was
8%. Both sets of bonds pay interest semiannually.
Required:
Calculate the issuance price of these bonds.