A company issues bonds with a par value of $800,000 on their issue date. The bonds mature in 5 years and pay 6% annual interest in two semiannual payments. On the issue date, the market rate of interest is 8%. Compute the price of the bonds on their issue date. The following information is taken from present value tables:

present value of an annuity for 10 periods at 3%... 8.5302
present value of an annuity for 10 periods at 4%... 8.1109
present value of 1 due in 10 oeriods at 3%... 0.7441
present value of 1 due in 10 periods at 4%... 0.6756

See here for step by step instructions on how to do just that...

The Basics and Pricing of Debt Securities (Bonds) (http://vitalbusinessinfo.blogspot.com/2009/10/accounting-for-bonds.html)

I've moved the article to a new location if anyone is interested... The Basics And Pricing Of Debt Securities (Bonds) | eFinancialAnalysis (http://efinancialanalysis.com/the-basics-and-pricing-of-debt-securities-bonds/)