Caitlyn, Janaya and Collin Inc. issues $2,000,000 7% bonds due in 10 years with interest payable semiannually to fund their new joint venture. The current market rate of interest for bonds of similar risk is 8%.  What is the dollar amount of the semi-annual interest payments (round up to the nearest dollar):  What is the cash proceeds form the sale of the bonds (round up to the nearest dollar)?

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Bond Valuation

Bond valuation are the notes issued by the corporation to raise long-term funds for the business. The corporations are required to pay the interest on such liabilities at a specified rate of interest (termed as coupon rate) at specified dates which may be on semi-annual or annual basis. These interest payments may be in the form of coupons.