Please show work thank you Bramble Corp issues 5120000 7 5ye

Please show work, thank you!

Bramble Corp. issues $5120000, 7%, 5-year bonds dated January 1, 2017 on January 1, 2017. The bonds pay interest semiannually on June 30 and December 31. The bonds are issued to yield 6%. What are the proceeds from the bond issue?

7010 Present value of a single sum for 5 periods Present value of a single sum for 10 periods | Present value of an annuity for 5 periods Present value of an annuity for 10 periods | 3.0% | 3.5% | 690 0.862611 0.8419 0.74726| 0.71299 0.7440 4.579711 4.51505 4.2123 4.10020 8.53029 0.70892| 0.55839 0.50835 8.31661| 7.36009| 7.02358

Solution

Bond Pays interest semi annually. Semi annual interest = Face Value x Coupon Rate x 6/12 = $ 51,20,000 x 7% x 6/12 = $   1,79,200 Due to semi annual interest payment, semi annual yield is 3% (6%/2) Proceeds from bond issue is present value of cash flow from bond. Present Value of coupon interest = $   1,79,200 x    8.53020 = $ 15,28,612 Present value of Face Value = $ 51,20,000 x    0.74409 = $ 38,09,741 Proceeds from bonds issue $ 53,38,353 Thus, Proceeds from bond\'s issue is $ 53,38,353