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On January 1, 2021, Frontier World issues $39.9 million of 7% bonds, due in 10...

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Accounting

On January 1, 2021, Frontier World issues $39.9 million of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year.

If the market rate is 6%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1).

  • Do not round interest rate factors.
  • Enter your answers in dollars not in millions.
  • Round "Market interest rate" to 1 decimal place.
  • Round your final answers to the nearest whole dollar.

I have the numbers calculated out (please verify), but how do I get the issue price? Was there a table I need to use?

Face Amount: 39,900,000

Interest Payment: 1,396,500

Periods to maturity: 20

Market Interest Rate: 3%

Issue price: ????

The bonds will issue at: (Discount, Premium, or Face Amount?)

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