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Required information [The following information applies to the questions displayed below.] PowerTap Utilities is planning to issue bonds with a face value of $1,000,000 and
Required information [The following information applies to the questions displayed below.] PowerTap Utilities is planning to issue bonds with a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31 . All of the bonds were sold on January 1 of this year. PowerTap uses the effective-interest amortization method. Assume an annual market rate of interest of 12 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1 ) Note: Use appropriate factor(s) from the tables provided. 3. What amount of cash should be paid to investors June 30 and December 31 of this year
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