On October 1, 2020, Ross Wind Energy Inc. issued a $1,650,000, 9.0%, seven-year bond. Interest is...
On October 1, 2020, Ross Wind Energy Inc. issued a $1,650,000, 9.0%, seven-year bond. Interest is to be paid annually each October 1. Assume a November 30 year-end.
a. Calculate the issue price of the bond assuming a market interest rate of 8% on the date of the bond issue.
Homework Answers
a. Issue price of the bond = Present value of interest @8%, 7 years - Present value of maturity value @8%, 7 years
= 1650000*9%*5.20637 + 1650000*0.58349
= $1735904
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On October 1, 2020, Ross Wind Energy Inc. issued a $1,650,000,
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On October 1, 2020, Ross Wind Energy Inc. issued a $1,650,000, 9.0%, seven-year bond. Interest is...
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