Scribd Logo
Upload

Welcome to Scribd!

  • Week 6

    Uploaded by

    Sitio Bayabasan
    6 views2 pages
    The document contains multiple examples of bond valuations including: - A company considering issuing a new bond with a par value of P100, 50,000 issued, 8% interest rate over 20 years, and unamortized flotation costs of P2 million, with additional issue costs of P3 million and an overlap period of 1 month, resulting in a net cash outflow of P2.77 million. - Calculating the present value of initial outlay for a new bond issue as P2.12 million. - Determining the bond yield to maturity is 12.89% for a bond with par value of P1,000, interest rate of 12% over 10 years and current price

    Original Description:

    Original Title

    week6

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    The document contains multiple examples of bond valuations including: - A company considering issuing a new bond with a par value of P100, 50,000 issued, 8% interest rate over 20 years, and unamortized flotation costs of P2 million, with additional issue costs of P3 million and an overlap period of 1 month, resulting in a net cash outflow of P2.77 million. - Calculating the present value of initial outlay for a new bond issue as P2.12 million. - Determining the bond yield to maturity is 12.89% for a bond with par value of P1,000, interest rate of 12% over 10 years and current price

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    6 views2 pages

    Week 6

    Uploaded by

    Sitio Bayabasan
    The document contains multiple examples of bond valuations including: - A company considering issuing a new bond with a par value of P100, 50,000 issued, 8% interest rate over 20 years, and unamortized flotation costs of P2 million, with additional issue costs of P3 million and an overlap period of 1 month, resulting in a net cash outflow of P2.77 million. - Calculating the present value of initial outlay for a new bond issue as P2.12 million. - Determining the bond yield to maturity is 12.89% for a bond with par value of P1,000, interest rate of 12% over 10 years and current price

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years.

    Unamortized flotation
    cost is 1,000,000.00. Tax rate is 30%. The current price is P101.00. The company is considering to
    issue a new bond. Par value of bond:P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. Additional issue cost of P3,000,000. The overlap period
    during which both issues will be outstanding is expected to be one month. How much is the net cash
    outflow from issuing new bonds? P2,770,000.00

    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years. Unamortized flotation
    cost is 2,500,000.00. Tax rate is 34%. The current price is P102.00. The company is considering to
    issue a new bond. Par value of bond:P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. The overlap period during which both issues will be
    outstanding is expected to be one month.. Additional issue cost of P400,000. What is the PV of initial
    outlay? P 2,117,500.00

    Par value of bond:P1,000.00. Interest rate is 12% for 10 years. The current price is P950.00. What is
    the bond yield to maturity? 12.89%

    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years. Unamortized flotation
    cost is 1,000,000.00. Tax rate is 30%. The current price is P101.00. The company is considering to
    issue a new bond. Par value of bond:P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. Additional issue cost of P3,000,000. The overlap period
    during which both issues will be outstanding is expected to be one month. How much is the net cash
    savings from the elimination of old bonds? P 3,135,000.00

    A firms borrows Php 1,000,000.00 which is to be repaid in 5 years. The loan will carry an 8% interest
    rate. How much is the remaining principal on year 4? P231,986.00

    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years. Unamortized flotation
    cost is 2,500,000.00. Tax rate is 34%. The current price is P102.00. The company is considering to
    issue a new bond. Par value bond: P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. The overlap period during which both issues will be
    outstanding is expected to be one month.. Additional issue cost of P400,000. How much is the net
    cash outflow from issuing new bonds? P2,606,000.00

    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years. Unamortized flotation
    cost is 1,000,000.00. Tax rate is 30%. The current price is P101.00. The company is considering to
    issue a new bond. Par value of bond:P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. Additional issue cost of P3,000,000. The overlap period
    during which both issues will be outstanding is expected to be one month. Should the refunding
    decision be accepted? No, net present value is negative.
    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years. Unamortized flotation
    cost is 2,500,000.00. Tax rate is 34%. The current price is P102.00. The company is considering to
    issue a new bond. Par value of bond:P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. The overlap period during which both issues will be
    outstanding is expected to be one month.. Additional issue cost of P400,000. How much is the net
    cash savings from elimination of old bonds? P2,927,500.00

    Par value of bond: P100.00. 50,000 issued. Interest rate is 9% for 20 years. Unamortized flotation
    cost is 1,000,000.00. Tax rate is 30%. The current price is P101.00. The company is considering to
    issue a new bond. Par value of bond:P100.00. 50,000 issued. Interest rate is 8% for 20 years.
    Unamortized flotation cost is 2,000,000.00. Additional issue cost of P3,000,000. The overlap period
    during which both issues will be outstanding is expected to be one month. What is the PV of initial
    outlay? P4,862,500.00

    A firms borrows Php 1,000,000.00 which is to be repaid in 5 years. The loan will carry an 8% interest
    rate. How much is the annual amortization? P250,438.00

    You might also like