a bank in Toronto issued bonds for $800,000 that were redeemable in ten years. It established a sinking fund that was earning 5.50% compounded semi-annually to retire this debt on maturity and made equal deposits at the beginning of every six months into the fund.

A) calculate the size ofthe periodic deposits?( round Up to the near cent)

B) Calculate the fund balance at the end of the 12th payment period?

C) Calculate the interest earned in the 13th period?

D) Calculate the amount by which the sinking fund increased in the 13th payment period?

E) Construct a partial sinking fund schedule to illustrate details of the first two payments

Payment period Payment Interest Earned Increase in the fund Fund Balance Book Value

0 $0.00 $800,000.00

1

2