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I attempted these three but I am having trouble computing the issue prices! On January 1, 2021, Frontier World issues $40.5 million of 7% bonds,
I attempted these three but I am having trouble computing the issue prices!
On January 1, 2021, Frontier World issues $40.5 million of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The proceeds will be used to build a new ride that combines a roller coaster, a water ride, a dark tunnel, and the great smell of outdoor barbeque, all in one ride. Required: 1-a. If the market rate is 6%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Do not round interest rate factors. Enter your answers in dollars not in millions. Round Market interest rate" to 1 decimal place. Round your final answers to the nearest whole dollar.) Bond Characteristics $ Amount 40,500,000 1,417,500 20 Face amount Interest payment Periods to maturity Market interest rate $ 3.0% Issue price 1-b. The bonds will issue at O A Discount A Premium 2-a. If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Do not round interest rate factors. Enter your answers in dollars not in millions. Round "Market interest rate" to 1 decimal place. Round your final answers to the nearest whole dollar.) $ Amount 40,500,000 1,417,500 $ Bond Characteristics Face amount Interest payment Periods to maturity Market interest rate Issue price 20 3.5% 2-b. The bonds will issue at O A Discount A Premium Face amount 3-a. If the market rate is 8%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Do not round interest rate factors. Enter your answers in dollars not in millions. Round "Market interest rate" to 1 decimal place. Round your final answers to the nearest whole dollar.) $ Bond Characteristics Face amount Interest payment Periods to maturity Market interest rate Amount 40,500,000 1,417,500 20 $ 4.0% Issue price 3-b. The bonds will issue at O A Discount O A Premium Face amountStep by Step Solution
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