Please explain how to compute the present value of a bond?
Galway Bay Enterprises issued 10%, 8-year, $2,000,000 par value bonds that pay intrest semiannually on October 1 and April 1. The bonds are dated April 1, 2002, and are issued on that date. The discount rate of interest for such bonds on April 1, 2002, is 12%. What cash proceeds did Galway Bay receive from issuance of the bond?© BrainMass Inc. brainmass.com March 4, 2021, 6:06 pm ad1c9bdddf
The solution shows all the calculations to arrive at the amount of cash proceeds from the issuance of the bond.