Chapter 4 using the bond worksheet 39 selecting the

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Unformatted text preview: to display PRI. Then press . A value for PRI is computed and displayed. Calculating Yield (YLD) 1. Press until PRI is displayed. 2. Key in a value for PRI and press 3. Press . to display YLD. Then press . A value for YLD is computed and displayed. Calculating Accrued Interest (AI) A value for AI (accrued interest) is computed and displayed automatically when you access the variable. AI is computed in terms of dollars per $100 of par value. Press 40 repeatedly until AI and its value are displayed. Chapter 4: Using the Bond Worksheet Example: Bond Worksheet Application You want to purchase a semiannual corporate bond that matures on 12/31/97 to settle on 6/12/96. The bond is based on the 30/360 day-count method with a coupon rate of 7%. It will be redeemed at 100% of its par value. For an 8% yield to maturity, compute the bond's price and the accrued interest. Procedure Keystrokes l Select Bond worksheet. Clear worksheet. Display SDT (old contents) SDT (old contents) 6.1296 SDT = 6-12-1996€ Enter coupon rate. 7 CPN = 7.00€ Enter redemption date. 12.3197 RDT = 12-31-1997€ Enter settlement date. Leave redemption value as is. RV = If necessary, select 30/360 day-count method. 360 If necessary, select two coupon payments per year. 2/Y Enter yield. 8 YLD = 100.00 8.00€ Compute price PRI = 98.56 View accrued interest. AI = 3.15 For an 8% yield to maturity, the price of the bond is $98.56 per 100 and the accrued interest is $3.15 per 100. Chapter 4: Using the Bond Worksheet 41 42 Chapter 4: Using the Bond Worksheet CHAPTER 5 Using the Depreciation Worksheet To access the Depreciation worksheet, press p. Then choose a depreciation method, enter the known values, and compute the unknown values. To choose a depreciation method, press repeatedly until the desired method is displayed. To view the variables, press and . Depreciation Worksheet Labels Label Meaning Type of Variable SL* Straight-line method Setting SYD* Sum-of-the-years’-digits method Setting DB* Declining-balan...
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