Week 7 - Question 2 (10 marks) On 1 July 2018 BMW Ltd issues $2 million in 10-year debentures that pay interest each six months at a coupon rate of 10 per cent. At the time of issuing the securities, the market requires a rate of return of 12 per cent. Interest expense is determined using the effective-interest method. 1-1/(1+k)" Formula for PV of $1 in n periods =1/(1+k)" Formula for present value of annuity of $1 per period for n periods where, kis the discount rate expressed in decimal k Required: (0) Determine the issue price of the debenture. Provide the journal entries at 1 July 2018 and 30 June 2019