TUGAS ACCOUNTING AND FINANCE

CHAPTER BONDS AND THEIR VALUATION

Disusun Oleh:
Kelompok 5
Nur Rofiqoh Arini
Leno Asman
Rizki Qomaruzaman
RA Keshari Adiandra Paramastri
Ogy Septiyan Situmorang
 1. Shanghai Textile Inc. has bonds outstanding with 9 years left to maturity. The
bonds have an 8% annual coupon rate and were issued 1 year ago at their par
value of $1,000. However, due to changes in interest rates, the bond’s market
price has fallen to $901.40. The capital gains yield last year was -9.86%.
a. What is the yield to maturity?
b. For the coming year, what are the expected current and capital gains yoelds?
(Hint: Refer to footnote 7 for the definition of the current yield and to Table 9.1)
c. Will the actual realized yields be equal to the expected yields if interest rates
change? If not? How will they differ?
Jawab:
a. YTM= ?
n= 9
PMT= 1000 x 0.008
= 80
PV= 901.40
FV= 1000
Input= 9.69%

𝐼𝑛𝑡.𝑟𝑎𝑡𝑒 𝑝𝑟𝑖𝑐𝑒
b. Current yields= Current price
80
= 901.40

= 0.0887
= 8.875%
P.Bonds endyear− P.bonds beginning year
Capital gain yields=
𝑃.𝑏𝑜𝑛𝑑𝑠 𝑏𝑒𝑔𝑖𝑛𝑛𝑖𝑛𝑔 𝑦𝑒𝑎𝑟

YTM= Current yield+Capt. Gain loss yield

9.69= 8.875+Capt. Gain
9.69-8.875=Capt. Gain
0.816=Capt. Gain

c.
 2. Last year Susuke Inc. issued at 10-year, 12% semiannual coupon bond at its par
value of $1,000. Currently, the bond can be called in 4 years at a price of $1,060
and it sels for $1,100.
a. What are the bond’s nominal yield to maturity and its nominal yield to call? Would
an investor be more likely to earn the YTM or the YTC?
b. What is the current yield? Is this yield affected by whether the bond is likely to be
called? (Hint: refer to footnote 7 for the definition of the current yield and to Table
9.1)
c. What is the expected capital gains (or loss) yield for the coming year? Is this
yoeld dependent on whether the bond is expected to be called? Explain your
answer.
Jawab:
a.YTM= ?
N= 10x2=20
PV= -1100
FV= 1000

0,12
PMT= 𝑥1000= 60
2

YTM= 5.1849x2
= 5.18x2
= 10.369 = 10.37%

YTC= ?
N= 4x2= 8
PV= -1100
FV= 1000
0,12
PMT= 𝑥1000= 60
2
 YTC= 5.07x2
= 10.149 = 10.15%

Annual PMT
b. Current yield= 𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑝𝑟𝑖𝑐𝑒
60x2
= 1100
120
= 1100

= 10.91%

c. Capital gain/loss yield= 10.91-10.15

= -0.54

3. Bond X is noncallable and has 20 years to maturity, a 9% annual coupon, and a

$1,000 par value. Your required return on Bond X is 10%; if you buy it, you plan
to hold it for 5 years. You (and the market) have expectations that in 5 years, the
yield to maturity on a 15 year bond with similar risk will be 8.5%. How much
should you be willing to pay forBond X today? (Hint: You will need to know how
much the bond will be worth at the end of 5 years)
Jawab:

N : 15
I = 8,5
PMT = 1.000 x 0,09 = 90
FV = 1.000
PV = 1.041,52

Dimasukan ke rumus = YTM = E(r)

YTM = 10% FV = 1.041,52
N=5 PV = 987,87
PMT = 90
4. Golden Services Enterprises has bonds outstanding with a $1,000 face value
and 10 years left until maturity. They have an 11% annual coupon payment, and
their current price is $1,175. The bobds may be called in 5 years at 109% of face
value (call price=$1,090)
a. What is the yield to matuurity?
b. What is the yield to call if they are called in 5 years?
c. Which yield might investors expect to earn on these bonds? Why?
d. The bond’s indenture indicates that the call provision gives the firm the right to
call the bobds at the end of each year beginning in Year 5. In year 5, the bobds
may be called at 109% of face value; but in each of the next 4 years, the call
percentage will decline by 1%. Thus, in Year 6, the may be called at 108% of
value face; in Year 7, they may be called at 107% of face value; and so forth. If
the yield curve is horizontal and interest rates remain at their current level, when
is the latest the investors might expect the firm to call the bonds?
Jawab:

A. YTM ?
N = 10
PV = -1175
PMT = 110 = 1000 X 0,11
FV = 1100
= 8,35%

B.
N=5
PV = -1175
PMT = 1000 X 0,11 = 110
FV = 1090
YTC = 8,13 %