Problem 1 (What is the solution for this?) A corporation sold an issue of 20-year bonds, having a total face value of 10,000,000 Php for 9,500,000 Php. The bonds bear interest at 16%, payable...

Problem 1 (What is the solution for this?)

A corporation sold an issue of 20-year bonds, having a total face value of 10,000,000 Php for 9,500,000 Php. The bonds bear interest at 16%, payable semiannually. The company wishes to establish a sinking fund for retiring the bond issue and will make semiannual deposits that will earn 12%, compounded semiannually. Compute the annual cost for interest and redemption of these bonds.

Ans should be: 1,730,000