Answer:
1) cash at issuance 2,955,000
2) cash for maturity 3,000,000 plus 210,000 interest = 3,210,000 total cash outlay at maturity
3) cash interest 210,000
Explanation:
1) It will receive 98.5/100 of the face value
3,000,000 x .985 = $2,955,000
2) at maturity it will still have to pay the face value regardless of the amount received for the bonds aty issuance thus; $3,000,000 We will also have to add up the interest for the last period.
3) the cash interest will be considered using the face value and the coupon rate of 7% regardless of current market rate and market price of the bond.
3,000,000 x 7% = 210,000
