Question
On May 1, 2022, Barcelona Company issued a five-year P2,000,000 face value bonds with stated rate of 16%. The bonds were issued to yield 14%.
On May 1, 2022, Barcelona Company issued a five-year P2,000,000 face value bonds with stated rate of 16%. The bonds were issued to yield 14%. Interests are payable semi-annually on May 1 and November 1. Barcelona Company uses the calendar year and the effective interest method of amortization. Present value of 1 at 7% for 10 periods is 0.5084. Present value of an ordinary annuity of 1 at 7% for 10 periods is 7.0236. How much is the issue price of the bonds?
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IT Auditing Using A System Perspective Premier Reference Source
Authors: Robert Elliot Davis
1st Edition
1799855481, 978-1799855484
