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La Goldee n Home 10-20 Cengagerow The Factors that affect the Bond Issue Price YEONG INC. is considering the issue of $111.00
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Answer #1

Solution 2a:

Computation of bond price
Table values are based on:
n= 20
i= 3.00%
Cash flow Table Value Amount Present Value
Par (Maturity) Value 0.55368 $111,000.00 $61,458
Interest (Annuity) 14.87747 $3,330.00 $49,542
Price of bonds $111,000

Solution 2b:

Computation of bond price
Table values are based on:
n= 10
i= 7.00%
Cash flow Table Value Amount Present Value
Par (Maturity) Value 0.50835 $111,000.00 $56,427
Interest (Annuity) 7.02358 $6,660.00 $46,777
Price of bonds $103,204
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