The calculation of interest receivable and amortization amount in each installment is that the interest receivable of the installment bond can be directly obtained by multiplying the par value by the coupon rate. However, the interest receivable for each period of a bond that repays the principal and interest once at maturity cannot be collected by stages, but can only be recovered once when the bond expires. In this way, the interest receivable calculated by installments is essentially the additional investment of investors in the issuer, and this investment is manifested as an annuity, which is increased year by year. The total amount of interest that can be charged when the bond matures is the final value of the annuity calculated at the actual interest rate. Conversely, when calculating the amortization amount of each period, we must calculate the annuity according to this final value and determine the interest receivable of each period. If the interest receivable in the equipment period is a, then:

A× annuity final value coefficient = total interest due on bonds

A=1/ year-end value coefficient× total interest due on bonds =r/(1+r)n-1× total interest due on bonds

According to the above example, interest receivable at the end of each year:

a = 8.7893%.