Homework Answers
Option C ($1000)
Though there's no standard for the denomination, bonds these days are typically issued in $1000 denominations
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QUESTION 3 In what denomination are bonds typically issued? O$10,000 $100,000 O $1,000 $1.000,000 Rupees si
Question 3 20 pts A firm has issued $1,000 bonds with a 3% coupon interest rate...
Question 3 20 pts A firm has issued $1,000 bonds with a 3% coupon interest rate paid semi- annually. The bonds mature 10 years from now and may be purchased for $800 each. What effective annual rate of return would you receive if you purchased the bond now and held it to maturity 10 years from now? Submit your answer in decimal form. EX: Submit 0.05 if the answer if 5 Margin of error: +/- 0.003
On January 1, 2012, Scott Corporation issued 10-year $100,000 bonds with a 6% stated rate of...
On January 1, 2012, Scott Corporation issued 10-year $100,000 bonds with a 6% stated rate of interest at 103. Scott Corporation pays the interest annually on December 31 and uses the straight-line amortization method. Which of the following is the correct general journal entry to record the interest expense for 2012? Debit Credit a. Interest Expense 6,000 Premium on Bonds Payable 300 Cash 5,700 b. Interest Expense 6,000 Cash 6,000 c. Interest Expense 6.300 Premium on Bonds Payable 300 Cash...
MSG Corporation issued $100,000 of 3-year, 6% bonds outstanding on December 31, 2020 for $106,000. The...
MSG Corporation issued $100,000 of 3-year, 6% bonds outstanding on December 31, 2020 for $106,000. The bonds pay interest annually and MSG uses straight-line amortization. On May 1, 2021, $10,000 of the bonds were retired at 112. As a result of the retirement, MSG will report: Multiple Choice a $600 loss. a $667 loss. a $1,200 loss. a $1,200 gain.
Problem 3 Headland Corporation issued 1,900 $1,000 bonds at 102. Each bond was issued with one...
Problem 3 Headland Corporation issued 1,900 $1,000 bonds at 102. Each bond was issued with one detachable stock warrant. After issuance, the bonds were selling in the market at 99, and the warrants had a market price of $41. Use the proportional method to record the issuance of the bonds and warrants. Account Titles and Explanation Debit Credit
Question 1 25 pts Ambrosino Corporation issued a 10 year $100,000 bond at 6% interest for...
Question 1 25 pts Ambrosino Corporation issued a 10 year $100,000 bond at 6% interest for $90,000. What amount will be debited to "Discount" on the date of issuance? $3,000 $10,000 $500 $100,000 Question 2 25 pts Ambrosino Corporation issued a 10 year, semiannual, $100,000 bond that pays interest at 6% interest for $90,000. How many periods will be used to calculate the amortization of the discount? 5 10 15 0 20 Ambrosino Corporation issued a 10 year $100,000 bond...
When $100,000 of 5% annual interest, 20-year bonds are issued at 98%, what will be the...
When $100,000 of 5% annual interest, 20-year bonds are issued at 98%, what will be the total interest expense for the bond issue? a. $102,000. b. $100,000. C. $98,000. d. $50,000
I need help on these questions. Question 5. Linville Corporation issued 15-year, par $1,000 bonds ten...
I need help on these questions.
Question 5. Linville Corporation issued 15-year, par $1,000 bonds ten years ago at a coupon rate of 5 percent. The bonds make semi-annual payments. If these bonds currently sell for 90 percent of par value, what is its yield to maturity (YTM)? Question 6. Pecos Company has just issued a 10-year, 10 percent coupon rate, $1,000- par bond that pays interest semiannually. Three years later, if the going rate of interest on the bond...
24. On January 2, Lincoln Motors, Inc. issued 1,000; $1,000 par value bonds to finance a...
24. On January 2, Lincoln Motors, Inc. issued 1,000; $1,000 par value bonds to finance a new showroom. The bonds are 5-year, 6% bonds that pay interest on June 30 and December 31 each year. When issued, investors required 7% interest and the bonds are due December 31, Year 5. Required: 1. Compute the selling price of the bonds. 2. Prepare the entry to record the sale of the bonds. 3. Prepare the journal entries for the first and second...
Question 16 (1 point) On January 1, 2021, Anne Teak Furniture issued $100,000 of 8% bonds,...
Question 16 (1 point) On January 1, 2021, Anne Teak Furniture issued $100,000 of 8% bonds, dated January 1. Interest is payable semiannually on June 30 and December 31. The bonds mature in 10 years. The annual market rate for bonds of similar risk and maturity is 10%. What was the issue price of the bonds? (Use appropriate factor(s) from the values provided.) PV of annuity of $1: (i=10%, n=10)=6.14457 (i=5%, n=20)=12.46221 (i=8%, n=10)=6.71008 (i=4%,n=20)=13.59033 PV of $1: (i=10%, n=10)=0.38554...
ABC Inc. recently issued $1,000 par bonds at a 8.40% coupon rate. The bonds have 18...
ABC Inc. recently issued $1,000 par bonds at a 8.40% coupon rate. The bonds have 18 years to maturity and the current price is $885. If the call price is $1,080 and the bond can be called in 8 years, what is the yield to call? Assume semi-annual compounding. Note: Convert your answer to percentage and round off to two decimal points. Do not enter % in the answer box. Question 19 1 pts The coupon rate on a bond...
Question 3 20 pts A firm has issued $1,000 bonds with a 3% coupon interest rate paid semi- annually. The bonds mature 10 years from now and may be purchased for $800 each. What effective annual rate of return would you receive if you purchased the bond now and held it to maturity 10 years from now? Submit your answer in decimal form. EX: Submit 0.05 if the answer if 5 Margin of error: +/- 0.003
On January 1, 2012, Scott Corporation issued 10-year $100,000 bonds with a 6% stated rate of interest at 103. Scott Corporation pays the interest annually on December 31 and uses the straight-line amortization method. Which of the following is the correct general journal entry to record the interest expense for 2012? Debit Credit a. Interest Expense 6,000 Premium on Bonds Payable 300 Cash 5,700 b. Interest Expense 6,000 Cash 6,000 c. Interest Expense 6.300 Premium on Bonds Payable 300 Cash...
Problem 3 Headland Corporation issued 1,900 $1,000 bonds at 102. Each bond was issued with one detachable stock warrant. After issuance, the bonds were selling in the market at 99, and the warrants had a market price of $41. Use the proportional method to record the issuance of the bonds and warrants. Account Titles and Explanation Debit Credit
Question 1 25 pts Ambrosino Corporation issued a 10 year $100,000 bond at 6% interest for $90,000. What amount will be debited to "Discount" on the date of issuance? $3,000 $10,000 $500 $100,000 Question 2 25 pts Ambrosino Corporation issued a 10 year, semiannual, $100,000 bond that pays interest at 6% interest for $90,000. How many periods will be used to calculate the amortization of the discount? 5 10 15 0 20 Ambrosino Corporation issued a 10 year $100,000 bond...
When $100,000 of 5% annual interest, 20-year bonds are issued at 98%, what will be the total interest expense for the bond issue? a. $102,000. b. $100,000. C. $98,000. d. $50,000
I need help on these questions.
Question 5. Linville Corporation issued 15-year, par $1,000 bonds ten years ago at a coupon rate of 5 percent. The bonds make semi-annual payments. If these bonds currently sell for 90 percent of par value, what is its yield to maturity (YTM)? Question 6. Pecos Company has just issued a 10-year, 10 percent coupon rate, $1,000- par bond that pays interest semiannually. Three years later, if the going rate of interest on the bond...
24. On January 2, Lincoln Motors, Inc. issued 1,000; $1,000 par value bonds to finance a new showroom. The bonds are 5-year, 6% bonds that pay interest on June 30 and December 31 each year. When issued, investors required 7% interest and the bonds are due December 31, Year 5. Required: 1. Compute the selling price of the bonds. 2. Prepare the entry to record the sale of the bonds. 3. Prepare the journal entries for the first and second...
Question 16 (1 point) On January 1, 2021, Anne Teak Furniture issued $100,000 of 8% bonds, dated January 1. Interest is payable semiannually on June 30 and December 31. The bonds mature in 10 years. The annual market rate for bonds of similar risk and maturity is 10%. What was the issue price of the bonds? (Use appropriate factor(s) from the values provided.) PV of annuity of $1: (i=10%, n=10)=6.14457 (i=5%, n=20)=12.46221 (i=8%, n=10)=6.71008 (i=4%,n=20)=13.59033 PV of $1: (i=10%, n=10)=0.38554...
ABC Inc. recently issued $1,000 par bonds at a 8.40% coupon rate. The bonds have 18 years to maturity and the current price is $885. If the call price is $1,080 and the bond can be called in 8 years, what is the yield to call? Assume semi-annual compounding. Note: Convert your answer to percentage and round off to two decimal points. Do not enter % in the answer box. Question 19 1 pts The coupon rate on a bond...
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