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Purchase Price per $100 for a Bond on an Interest Date
– PRICE
The purchase price per $100 for a bond on an interest date can be calculated using
Excel’s PRICE function. See the table below for a detailed list of the exercises and
problems in the text that can be solved using this function.
This function is included in the Analysis ToolPak.
Syntax
=PRICE(settlement,maturity,rate,yield,redemption,frequency,basis)
Settlement – settlement date of the security
Maturity – maturity date of the security
Rate – interest rate at the issue date
Yield – annual yield of the security
Redemption – value of the security at redemption
Frequency – number of coupon payments made per year
1 = annual
2 = semiannual
4 = quarterly
Basis – day count basis of the security. Defaults to 0 if omitted.
0 = 30/360 (US NASD)
1 = actual/actual
2 = actual/360
3 = actual/365
4 = European 30/365
General Example
The following general example shows how the PRICE function can be used. Notice that
the PRICE function appears in the formula bar.
1
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View Full DocumentUsing the PRICE Function in a Spreadsheet
To calculate the purchase price per $100 for a bond on an interest date, create a
spreadsheet by following Steps 1 to 8. Or, to use the PRICE function right away, open
the PRICE worksheet in the Excel Functions Templates workbook. All fields have been
formatted for you (currency, percentage, number of decimals displayed).
Step 1
: Enter
PRICE Function
in cell A1. You will replace
PRICE Function
with your
project name when you use your spreadsheet for a particular question or situation.
Step 2
: In cell A3 enter
Settlement Date
.
In cell A4 enter
Maturity Date
.
In cell A5 enter
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 Fall '05
 TonyCirusolo
 Math

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