Part B. (5 marks). On January 1, 2020 Lance Co. issued five-year bonds with a face value of $400,000 and a stated interest rate of 10% with interest payable annually on January 1. The bonds were sold (issued) to yield a market rate of 8%. The issue price of the bonds is the sum of the present value of the interest payments and of the face amount at maturity discounted at the market rate. Compute the following:

i. Present value of annual interest payments:_____________ ii. Present value of the face amount of $400,000 due in 5 years: _______________________________________________________ iii. Issue Price of bonds:_______________________