Eleanor issued P10,000,000 of 10% bonds on July 1, 2008. The prevailing market rate of interest for these bonds was 12% on the date of issue. The bonds will mature on July 1, 2018. Interest is paid semiannually on July 1 and January 1. Eleanor uses the effective interest rate method bond premium or discount.

The following present value factors are taken from the present value tables:

Present value of 1 at 12% for 10 periods .32917

Present value of 1 at 6% for 20 periods .31180

Present value of an ordinary annuity of 1 at 12% for 10 periods 5.65022

Present value of an ordinary annuity of 1 at 6% for 20 periods 11.46992

How much was received by Eleanor from the sale of bonds on July 1, 2008?

Answer rating: 100% (QA)

Cash flow DF 6a Amountb Present ... View the full answer