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QUESTION TWO The directors of a company authorized the issuance of Ksh30,000,000/= of serial bonds on September, 1993

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QUESTION TWO The directors of a company authorized the issuance of Ksh30,000,000/= of serial bonds on September, 1993. Interest is to be paid annually on September 1 at a rate of 9%. The indenture provides the following redemption provision i Ksh5,000,000/= of the issue to be redeemed on September 1, 1998; ü Ksh5,000,000/= of the issue to be redeemed on September 1, 1998; Ksh 10,000,000/= of the issue to be redeemed on September 1, 2003; iv. Ksh 15,000,000/= of the issue to be redeemed on September 1, 2007; Required: a) Find the purchase price of the issue on September 1, 1993, which would yield i=8% (10 marks) b) What would be the value of bonds on september 1, 2000? (10 marks)