Question
On January 1, 2017, Bonita Industries issued eight-year bonds with a face value of $6090000 and a stated interest rate of 10%, payable semiannually on
On January 1, 2017, Bonita Industries issued eight-year bonds with a face value of $6090000 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 8 periods at 10%0.467Present value of 1 for 8 periods at 12%0.404Present value of 1 for 16 periods at 5%0.458Present value of 1 for 16 periods at 6%0.394Present value of annuity for 8 periods at 10%5.335Present value of annuity for 8 periods at 12%4.968Present value of annuity for 16 periods at 5%10.838Present value of annuity for 16 periods at 6%10.106
The issue price of the bonds is
$5537637.
$6093045.
$5476737.
$5485872.
What is the proper way to compute the answer for a question like this?
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