Straight Bond value of the Convertible Company c has a convertible debenture outstanding that provides an 8% coupon(interest is paid semiannually) and exactly 20 years until final maturity. A similar nonconvertible bond will currently provide a 5% semiannual yield to maturity. What is the straight bond value of Company C's convertible bond? V=$40 PViFAs%20x)+$1000(PVF5%20x) =$40(17159)+$1,000(142) =$68636+$142 =$82836 22-1422-14 Straight Bond Value of the Convertible Company C has a convertible debenture outstanding that provides an 8% coupon (interest is paid semiannually) and exactly 20 years until final maturity. A similar nonconvertible bond will currently provide a 5% semiannual yield to maturity. What is the straight bond value of Company C’s convertible bond? V = $40 (PVIFA5%, 20x2) + $1,000 (PVIF5%, 20x2) = $40 (17.159) + $1,000 (.142) = $686.36 + $142 = $828.36