Following bond if interest (coupon) is paid annually? (Round to two decimal places.)- XYears toData Tablepon RateMaturity5%15following bond if interest (coupon) is(Click on the following icon in order to copy its contents into a spreadsheet)Yiold toMaturityYears toYears toPar Value$1,000.00$1,000,00$5,000.00$5,000,00Coupon Rate5%9%8%11%Maturity15252020Price$900 00$1,000.00$4,140.00$7,110.00pon RateMaturity9%25PrintDone Yield to maturity. What is the yield of each of the following bonds,if interest (coupon) is paid annually?a. What is the yield of the following bond if interest (coupon) is paid annually? (Round to two decimal places.)Years toYield toPar ValueCoupon RateMaturityMaturityPrice$1,000.005%156.03 %$900.00b. What is the yield of the following bond if interest (coupon) is paid annually? (Round to two decimal places.)Yiold toMaturityYoars toPar ValuoCoupon RateMaturityPrice$1,000.009%25$1,000.00

Assumption:Coupon Interest is paid annually. Required: Compute the YTM in each case.

llowing bond if interest (coupon) is paid annually? (Round to two decimal places. Years to Data Table on Rate Maturity 5% 15 ollowing bond if interest (coupon) is (Click on the following icon in order to copy its contents into a spreadsheet.) Years to Years to Yield to Bon Rate Maturity Par Value Coupon Rate Maturity Maturity Price $1,000.00 5% 15 $900.00 9% 25 $1,000.00 9% 25 $1,000.00 8% 11% $5,000.00 20 $4,140.00 $5,000.00 20 $7,110.00 Print Done

llowing bond if interest (coupon) is paid annually? (Round to two decimal places. Years to Data Table on Rate Maturity 5% 15 ollowing bond if interest (coupon) is (Click on the following icon in order to copy its contents into a spreadsheet.) Years to Years to Yield to Bon Rate Maturity Par Value Coupon Rate Maturity Maturity Price $1,000.00 5% 15 $900.00 9% 25 $1,000.00 9% 25 $1,000.00 8% 11% $5,000.00 20 $4,140.00 $5,000.00 20 $7,110.00 Print Done

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 7P: Bond Valuation with Semiannual Payments Renfro Rentals has issued bonds that have a 10% coupon rate,...

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a. Reset the Data Section to its initial values. The price of this bond is 1,407,831. What would it be if there were only 9 or 8 years to maturity? Use the worksheet to compute the bond issue prices and enter them in the spaces provided. Bond issue price (9 years to maturity) __________________ Bond issue price (8 years to maturity) __________________ b. Compare these prices to the bond-carrying values found in the effective interest amortization schedule you originally printed out in requirement 3. Explain the similarity. c. Click the Chart sheet tab. The chart presented shows the price behavior of this bond based on years to maturity. Explain what effect years to maturity has on bond prices. Check your explanation by trying 8% as the effective rate (cell E10) and clicking the Chart sheet tab again. Also try 9%. When the assignment is complete, close the file without saving it again. Worksheet. Modify the BONDS3 worksheet to accommodate bonds with up to 20-year maturity. Use your new model to determine the issue price and amortization schedules of a 2,000,000, 18-year, 10% bond issued to yield 9%. Preview the printout to make sure that the worksheet will print neatly, and then print the worksheet. Save the completed file as BONDST. Hint: Expand both amortization schedules to 20 years. Expand the scratch pad to 20 years. Modify FORMULA1 in cell F17 to include the new ranges. Chart. Using the BONDS3 file, prepare a line chart that plots annual interest expense over the 10-year life of this bond under both the straight-line and effective interest methods. No Chart Data Table is needed. Put A23 to A32 in the Label format and then select A23 to A32, D23 to D32, and B40 to B49 as a collection. Enter all appropriate titles, legends, formats, and so forth. Enter your name somewhere on the chart. Save the file again as BONDS3. Print the chart.
Smashing Cantaloupes Inc. issued 5-year bonds with a par value of $35,000 and an 8% semiannual coupon (payable June 30 and December 31) on January 1, 2018, when the market rate of interest was 10%. Were the bonds issued at a discount or premium? Assuming the bonds sold at 92.288, what was the sales price of the bonds?
Issue Price The following terms relate to independent bond issues: 500 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments 500 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments 800 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments 2,000 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments Required Assuming the market rate of interest is 10%, calculate the selling price for each bond issue.
Bond Valuation with Semiannual Payments Renfro Rentals has issued bonds that have a 10% coupon rate, payable semiannually. The bonds mature in 8 years, have a face value of $1,000, and a yield to maturity of 8.5%. What is the price of the bonds?
Krystian Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 4% when the market rate was 6%. Interest was paid semi-annually. Calculate and explain the timing of the cash flows the purchaser of the bonds (the investor) will receive throughout the bond term. Would an investor be willing to pay more or less than face value for this bond?
On July 1, Somerset Inc. issued $200,000 of 10%, 10-year bonds when the market rate was 12%. The bonds paid interest semi-annually. Assuming the bonds sold at 58.55, what was the selling price of the bonds? Explain why the cash received from selling this bond is different from the $200,000 face value of the bond.
Current Yield with Semiannual Payments A bond that matures in 7 years sells for $1,020. The bond has a face value of $1,000 and a yield to maturity of 10.5883%. The bond pays coupons semiannually. What is the bond’s current yield?
Beluga Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 3% when the market rate was 4%. Interest was paid annually. The bonds were sold at 87.5. What was the sales price of the bonds? Were they issued at a discount, a premium, or at par?