Company A issued a 5 year 4.5% coupon bond with a stated value (par or face) of $15,000,000 on December 31, 2022 when the market rate of interest (yield to maturity) was 5%. The bond pays interest semiannually.
1. Was Company A’s bond issued at a discount, premium or par and why?
2. What is the price of the bond [show your financial calculator syntax for credit]?

3. Now assume the above bond was settled (purchased) on 4/30/2023.
a. What is the cash (dirty) price of the bond [show your work for credit]?
b) How would the ask (quote or clean) price of the bond be listed [show your work for credit]?

Answer rating: 100% (QA)

1 Was Company As bond issued at a discount premium or par and why Company As bond was issued at a di... View the full answer