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White raven [17]
3 years ago
6

Williams Company plans to issue bonds with a face value of $605,000 and a coupon rate of 6 percent. The bonds will mature in 10

years and pay interest semiannually every June 30 and December 31. All of the bonds are sold on January 1 of this year. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use the appropriate factor(s) from the tables provided. Round your final answer to whole dollars.) Determine the issuance price of the bonds assuming an annual market rate of interest of 6 percent.
Business
1 answer:
marysya [2.9K]3 years ago
7 0

Answer:

$605,000

Explanation:

According to the scenario, computation of the given data are as follows,

Face value = $605,000

Coupon rate = 6%

Rate of interest = 6%

As coupon rate and market interest rate is similar, then in this scenario issuance price of the bond is equals to face value of the bond.

Then, Issuance price of bonds = Face value of bonds

Issuance price of bonds = $605,000  

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