Spiller Corp. plans to issue 10%, 15-year, $500,000 par value bonds payable that

Question

Spiller Corp. plans to issue 10%, 15-year, $500,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated December 31, 2016, and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places.) If the market rate of interest for the bonds is 8% on the date of issue, what will be the total cash proceeds from the bond issue? Table Values are Based on: Table Value Amount Present Value Cash Flow Present (maturity) value Interest (annuity) Total cash proceeds

Explanation / Answer

Table values are based on: n = 4% I = 30 Cash flow Table value Amount Present value Present(maturity) value 17.292 25000 432300 Interest(annuity) 0.3083 500000 154150 Total cash proceeds 586450

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