Face value= | $80,000,000 | |||
Present value | ||||
Period | Date | Cashflows | Value | Calculation |
1 | 31-Jul-21 | $3,600,000 | $3,428,571 | (3,600,000/(1.05)^1) |
2 | 31-Jan-22 | $3,600,000 | $3,265,306 | (3,600,000/(1.05)^2) |
3 | 31-Jul-22 | $3,600,000 | $3,109,815 | (3,600,000/(1.05)^3) |
4 | 31-Jan-23 | $3,600,000 | $2,961,729 | (3,600,000/(1.05)^4) |
5 | 31-Jul-23 | $3,600,000 | $2,820,694 | (3,600,000/(1.05)^5) |
6 | 31-Jan-24 | $3,600,000 | $2,686,375 | (3,600,000/(1.05)^6) |
7 | 31-Jul-24 | $3,600,000 | $2,558,453 | (3,600,000/(1.05)^7) |
8 | 31-Jan-25 | $83,600,000 | $56,583,771 | (83,600,000/(1.05)^8) |
$77,414,714 | ||||
1 | Price of the bonds issued on February 01, 2021 | $77,414,714 | ||
*if you have any doubt relating to this question please feel free to ask in the comment section.
On February 1, 2021, Cromley Motor Products issued 9% bonds, dated February 1, with a face...
On February 1, 2018, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $65 million. The bonds mature on January 31, 2022 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $65,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...
On February 1, 2021, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $55 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $55,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...
On February 1, 2021. Cromley Motor Products issued 12% bonds, dated February 1, with a face amount of $85 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 14%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $85,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...
On February 1, 2021, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $95 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $95,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...
rest; ries On February 1, 2021, Cromley Motor Products issued 9% bonds, dated February 1, with a face amount of S80 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 10%. Interest is paid semiannually on July 31 and January 31. Barwell Industries acquired $80,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. Required: 1. Determine the price of the...
On February 1, 2021, Cromley Motor Products issued 10% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 12%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $60,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...
On February 1, 2021, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $85 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $85,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. Required: 1. Determine the price of the bonds issued...
On February 1, 2021, Cromley Motor Products issued 8% bonds, dated February 1, with a face amount of $75 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 10%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $75,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31.1. Determine the price of the bonds issued on February...
On February 1, 2021, Cromley Motor Products issued 10% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 12%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $60,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...
On February 1, 2021, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $90 million. The bonds mature on January 31, 2025 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $90,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1,...