What we have so far:
*12 bonds
*1 bond = $1,000
*Quotation of 84.50% per bond ($845 each).
What to find:
*QT - Quotation Total. QT = (12 x $1,000) x Quotation
*TC - Total Cost. TC = (12 x $1,000) + QT
Solution:
Finding QT:
QT = (12 x $1,000) x Quotation
QT = (12 x $1,000) x 84.50%
QT = $12,000 x 84.50%
QT = $10,140
Finding TC:
TC = (12 x $1,000) + QT
TC = (12 x $1,000) + $10,140
TC = $12,000 + $10,140
TC = $22,140 <--- What we are looking for.
Therefore, the total cost of twelve $1,000 bonds at a quotation of 84.50% is: $22,140.