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lina2011 [118]
3 years ago
5

Mette Badminton Equipment Co. wants to raise $7 million to expand operations. To accomplish this, it plans to issue 20-year bond

s with a face value of $1,000. The coupon rate is set at 9% and the couponds will be paid semi-annually. The bonds are priced at a yield-to-maturity of 10%. What is the minimum number of bonds the firm must sell to raise the $7 million

Business
1 answer:
givi [52]3 years ago
7 0

Answer:

7,657 bonds

Explanation:

In order to determine the minimum number of bonds first we have to find out the present value of the bond which is to be shown in the attached spreadsheet.

Data provided in the question

Future value or Face value = $1,000

PMT = $1,000 × 9% ÷ 2 = $45

Rate of interest = 10% ÷ 2 = 5%

NPER = 20 years × 2 = 40 years

The formula is shown below:

= PV(Rate;NPER;PMT;FV;type)

So, after solving this, the present value of the bond is $914.20

Now the raise amount is $7 million

So, the number of minimum number of bonds is

= $7,000,000 ÷ $914.20

= 7,657 bonds

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ackson Co. needs to replenish its petty cash fund. Currently, it contains $11 in cash and receipts for supplies of $40 and deliv
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On January 1, 2018, VKI Corporation awarded restricted stock units (RSUs) representing 19 million of its $1 par common shares to
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1. Total compensation cost= $96.9 m

2. Compensation expense  $32.3 m

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The question relates to 'EQUITY GRANT', which is some sort of compensation given to somebody, especially/specifically to employees of an entity provided that certain conditions/vesting requirements are satisfied by the employee. For example, an entity in it's initial phases of growth (because certain entities don't have the money/working capital in initial stages of business) offers it's employees to stay within the entity for at least three years during which no stipend will be paid but shall receive equity ownership thereafter. In such a situation the employer grants them equity once the vesting requirement is satisfied by the employees.

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