Question

Spiller Corp. plans to issue 8%, 8-year, $560,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated December 31, 2019, and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is 6% on the date of issue, what will be the total cash proceeds from the bond issue? Answer is not complete. Table Values are Based on: n = 16 2% X Cash Flow Table Value Amount Present Value 560,000 $ 407,904 X Present (maturity) value Interest (annuity) Total cash proceeds 0.7284 X $ 13.5777 X

Answer 1

Table Values are Based on:
n =	16
i =	3%
Cash Flow	Table Value	Amount	Present Value
Present (maturity) value	0.62317	560,000	348,975.20
Interest (annuity)	12.5611	22,400	281,368.64
Total cash proceeds			$630,344

Semi annual interest payment = Par value of bonds x Interest rate x 6/12

= 560,000 x 8% x 6/12

= $22,400

Kindly comment if you need further assistance. Thanks‼!

Note: Exact answer may slightly differ due to rounding off and factor value considered