Reference no: EM132614941

Question - On January 1, 2020 Pharoah Co. issued five-year bonds with a face value of $530,000 and a stated interest rate of 12% payable semiannually on July 1 and January 1. The bonds were sold to yield 10%.

Present value table factors are:

Present value of 1 for 5 periods at 10% 0.62092

Present value of 1 for 5 periods at 12% 0.56743

Present value of 1 for 10 periods at 5% 0.61391

Present value of 1 for 10 periods at 6% 0.55839

Present value of an ordinary annuity of 1 for 5 periods at 10% 3.79079

Present value of an ordinary annuity of 1 for 5 periods at 12% 3.60478

Present value of an ordinary annuity of 1 for 10 periods at 5% 7.72173

Present value of an ordinary annuity of 1 for 10 periods at 6% 7.36009

Required - Calculate the issue price of the bonds.