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Calculate the issue price for the bonds

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Question - On 1 July 2022, Kelly ltd issued 5 year bonds with a total face value of 1,000,000 and which paid interest of 100,000 annually in arrears. The market required interest rate for Kelly ltd bonds was 14 per cent.

Cumulative present value factor at 14% for 5 years = 3.4331

Present value factor at 14% for the 5th year = 0.5194

Required - Calculate the issue price for the bonds.

Reference no: EM133019600

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