Here is the question: ABC Inc. issued $18,000,000 of ten-year, 9% bonds at an effective rate of 10%. Interest is payable semi-annually. To find the semi-annual interest amount, i thought the equation would be to multiply the bond issue amount by 20 (10 semi-annual pymt = 20 ). I need to understand how to find the correct answer in order to find compute the cash proceeds & any discount, then the process of amortizing the bond. PLEASE HELP!!!!!!
2007-02-27 12:56:27 · 1 answers · asked by 723 1 in Business & Finance ➔ Credit
It sounds like you need to learn more about bonds before asking a question like this.
http://www.investopedia.com/university/bonds/
it depends on what kind of bonds they are - municipal, corporate, zero-coupon, etc...
Here's another one: http://www.fool.com/school/basics/basics05.htm
Go through investopedia.com and fool.com - they're pretty good at laying out the info for basics of investing.
Or even better, check out your finance textbook - they usually go through the calculations in detail.
2007-02-28 02:12:37 · answer #1 · answered by Fabulously Broke in the City 5 · 0⤊ 0⤋