Present Value of Bonds Payable; Premium

Moss Co. issued $100,000 of five-year, 11% bonds with interest payable semiannually, at a market (effective) interest rate of 8%.

Determine the present value of the bonds payable, using the present value tables in Exhibit 8 and Exhibit 10.

Note: Round to the nearest dollar.

EXHIBIT 10 Present Value of an Annuity of $1 at Compound Interest Present Value of $1 at Compound Interest EXHIBIT 8 4% 472% 5% 4% 492% 5% 6% 12% 13% Periods 1 2 3 Periods 1 2 3 4 0.96154 1.88609 2.77509 3.62990 4.45182 5.24214 6.00205 6.73274 7.43533 8.11090 5 6 7 8 0.95694 1.87267 2.74896 3.58753 4.38998 5.15787 5.89270 6.59589 7.26879 7.91272 0.95238 1.85941 2.72325 3.54595 4.32948 5.07569 5.78637 6.46321 7.10782 7.72173 572% 0.94787 1.84632 2.69793 3.50515 4.27028 4.99553 5.68297 6.33457 6.95220 7.53763 6% 0.94340 1.83339 2.67301 3.46511 4.21236 4.91732 5.58238 6.20979 6.80169 7.36009 6%% 0.93897 1.82063 2.64848 3.42580 4.15568 4.84101 5.48452 6.08875 6.65610 7.18883 7% 0.93458 1.80802 2.62432 3.38721 4.10020 4.76654 5.38929 5.97130 6.51523 7.02358 10% 0.90909 1.73554 2.48685 3.16987 3.79079 4.35526 4.86842 5.33493 5.75902 6.14457 11% 0.90090 1.71252 2.44371 3.10245 3.69590 4.23054 4.71220 5.14612 5.53705 5.88923 12% 0.89286 1.69005 2.40183 3.03735 3.60478 4.11141 4.56376 4.96764 5.32825 5.65022 13% 0.88496 1.66810 2.36115 2.97447 3.51723 3.99755 4.42261 4.79677 5.13166 5.42624 4 5 6 0.96154 0.92456 0.88900 0.85480 0.82193 0.79031 0.75992 0.73069 0.70259 0.67556 0.95694 0.91573 0.87630 0.83856 0.80245 0.76790 0.73483 0.70319 0.67290 0.64393 0.95238 0.90703 0.86384 0.82270 0.78353 0.74622 0.71068 0.67684 0.64461 0.61391 572% 0.94787 0.89845 0.85161 0.80722 0.76513 0.72525 0.68744 0.65160 0.61763 0.58543 0.94340 0.89000 0.83962 0.79209 0.74726 0.70496 0.66506 0.62741 0.59190 0.55839 672% 0.93897 0.88166 0.82785 0.77732 0.72988 0.68533 0.64351 0.60423 0.56735 0.53273 7% 0.93458 0.87344 0.81630 0.76290 0.71299 0.66634 0.62275 0.58201 0.54393 0.50835 10% 0.90909 0.82645 0.75131 0.68301 0.62092 0.56447 0.51316 0.46651 0.42410 0.38554 11% 0.90090 0.81162 0.73119 0.65873 0.59345 0.53464 0.48166 0.43393 0.39092 0.35218 0.89286 0.79719 0.71 178 0.63552 0.56743 0.50663 0.45235 0.40388 0.36061 0.32197 0.88496 0.78315 0.69305 0.61332 0.54276 0.48032 0.42506 0.37616 0.33288 0.29459 7 8 9 10 9 10