Compute the amount of cash a company will receive from the following bond issues.Required:a) _______________ Issued $200,000 of 5-year, 8% bonds at 98b) _______________ Issued $800,000 of 4-year, 9% bonds at 95c) _______________ Issued $400,000 of 10-year, 8% bonds at 102.5d) _______________ Issued $100,000 of 5-year, 12% bonds at 103
What will be an ideal response?
a) $196,000
Issue price = Face value of $200,000 × 98% = $196,000
b) $760,000
Issue price = Face value of $800,000 × 95% = $760,000
c) $410,000
Issue price = Face value of $400,000 × 102.5% = $410,000
d) $103,000
Issue price = Face value of $100,000 × 103% = $103,000
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