Bingham Corporation has a new issue of Debt it wishes to value. Using the following information, calculate the following:
Annual Interest = 12 percent
Price of Bond = $96
Principle Pmt = $55
Years to Maturity = 9
Calculate the Approximate Yield to Maturity.
Is this Bond a good issue for the company? Investor? Why?
This solution contains step-by-step calculations in an Excel file to determine the approximate yield to maturity using annual interest, price of bond, principle, years to maturity. An analysis of the results is also provided.