Reference no: EM132878875

Question -

Q1. On 7/1/Year1, the Ish-U-Bonds Company issued bonds with a face amount of $1,000,000 due in 20 years. Coupons are paid semi-annually on December 31 and July 1, beginning 12/31/ Year 1. The annual coupon rate is 8%, and the annual market yield on the issuance day is 6%. What are the bonds issuance proceeds?

a. There are missing parameters to solve this question

b. $1,123,151

c. $306,560

d. $1,191,917

e. None of the above is correct

Q2. Using the details for the Ish-U-Bonds Company in Q1 above, what is the coupon cash payment amount paid each period?

a. $40,000

b. $80,000

c. $20,000

d. There are missing parameters to solve this question

e. None of the above is correct