Wine and Roses, Inc., offers a bond with a coupon of 7.0 percent with semiannual payments and a yield to maturity of 7.75 percent. The bonds mature in 14 years. What is the market price of a $1,000 face value bond?

P = 9359.8

Explanation:

Given:

As we know that, the formula to find out YTM is:

       YTM = [C + (F-P/n) ] / (F+ P) / 2

<=> 0.0775 = [ 70 + (1000 - P/14)] / (1000+P)/2

<=> 0.0775(1000+P) /2 =  70 + (1000 - P/14)

<=> 0.0775(1000+P)  = 140 + 2(1000 - P/14)  

<=> P = 9359.8

So the price of the $1,000 face value bond is 9359.8  

the amount of cash did Mertis spend in 2012 on new fixed assets is $84,971

Explanation:

The computation of the amount of cash did Mertis spend in 2012 on new fixed assets is shown below;

= ending net fixed assets + depreciation expense - beginning net fixed assets

= $865,000 + $34,971 - $815,000

= $84,971

Hence, the amount of cash did Mertis spend in 2012 on new fixed assets is $84,971