Homework Answers
Answers
- Answer #6
Correct Answer = Option #2: Issue price of a bond is based on a present value calculation.
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Bonds issue price is calculated by ADDING the: |
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Discounted face value of bonds payable at 'applicable' market rate of interest [Face value x PV Factor], and |
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Discounted Interest payments amount (during the lifetime) at 'applicable' market rate of interest [Interest payment x PV Annuity factor] |
- Answer #5
Correct Answer = Option #3: Unearned Revenue will be credited as amount is received as advance for services that are not yet provided. - Answer #4
Correct Answer = Option #2: Callable bonds are the bond that can be redeemed by issuer at any time. - Answer #3
Correct Answer = Option #2: Convertible bonds are the bonds were the borrower gets the stock at the time of repayment when the bonds get converted to the stock.
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Question 6 1 pts The issue price of a bond is: determined by the company issuing...
5 pts Question 8 Which one of the following terms applies to a bond that can...
5 pts Question 8 Which one of the following terms applies to a bond that can be exchanged for the issuing company's common stock in the future? Callable . Municipal Zero coupon Convertible
QUESTION 6 1 poir Bonds that contain a provision that allows the holders to exchange the...
QUESTION 6 1 poir Bonds that contain a provision that allows the holders to exchange the bonds for other securities of the issuing corporation are called debenture bonds. secured bonds. callable bonds. convertible bonds.
Question 2 1 pts If the terms of a bond issue allow a corporation to redeem...
Question 2 1 pts If the terms of a bond issue allow a corporation to redeem the bonds prior to their maturity date, then the bonds are said to contain a(n): capital gains provision interest rate provision call provision 0 put provision 0 coupon provision
Question 23 1 pts A corporate bond has an expected, total (not excess) return of 5%....
Question 23 1 pts A corporate bond has an expected, total (not excess) return of 5%. The risk-free rate is 2% and the expected market return (total, not excess) is 10%. Which of the following is closest to the beta of the corporate bond? 0.3 0.375 0.625 0.5 2.67 Question 22 1 pts Corporation X issues three bonds, A, B, and C, with the same par value, coupon rate, seniority, and maturity. Bond A is convertible, that is it can...
Question 7 1 pts You purchase a bond with an clean price of $1,144. The bond...
Question 7 1 pts You purchase a bond with an clean price of $1,144. The bond has a coupon rate of 10 percent, and there are 2 months to the next semiannual coupon date. What is the dirty price of the bond? Enter the answer with 2 decimals (eg. 954.23). 1.17733 Question 8 1 pts Ackerman Co. has 11 percent coupon bonds on the market with 9 years left to maturity The bonds make semiannual payments. If the bond currently...
Question 7 2 pts Highland Corp., a U.S. company, has a 7 year bond whose yield to maturity is 4 percent. The bond has n...
Question 7 2 pts Highland Corp., a U.S. company, has a 7 year bond whose yield to maturity is 4 percent. The bond has no coupon payments but assume semi annual compounding. What is the price of this zero coupon bond? Round the answer to 2 decimal places. Question 8 2 pts Marshall Company is issuing four-year bonds with a coupon rate of 4.5 percent and semiannual coupon payments. If the current market rate for similar bonds is 9.5 percent,...
Bond questions 52018 PART-1-Please SELECT from the choices presented bonds payable callable bond convertible bond Annuities...
Bond questions 52018 PART-1-Please SELECT from the choices presented bonds payable callable bond convertible bond Annuities Streams of level (ie, the same amount each pariod) payments occurring on regular 1. intervals An obligation dvded into transtferable units requiring the issuer to make periodic interest payments and an eventual repayment of the face amount, 2. A bond that provides the issuer an option to reacquire the bends before scheduled 3 maturity at a preset price A bond that may be converted...
1. From the standpoint of the issuing company, a disadvantage of using bonds as a means...
1. From the standpoint of the issuing company, a disadvantage of using bonds as a means of long-term financing is that A. bond interest is deductible for tax purposes. B. interest must be paid on a periodic basis regardless of earnings. C. income to stockholders may increase as a result of trading on the equity D. the bondholders do not have voting rights. 2. Bonds that mature at a single specified future date are called A. coupon bonds. B. term...
Questions 1 to 10 are false statements. Please re-write each statement so that it is true....
Questions 1 to 10 are false statements. Please re-write each statement so that it is true. It may be as simple as one word change or more complex. 1. A callable bond is one in which the issuer is required to retire a certain amount of the outstanding bonds each year to ensure that all the bond principle is paid by final maturity. 2. There is no default risk with either Treasury bonds or municipal bonds. 3. The dirty price...
Question 21 1 pts A $1,000 par value 9% annual coupon bond matures in 10 years...
Question 21 1 pts A $1,000 par value 9% annual coupon bond matures in 10 years but is callable in 3 years. The bond is currently selling for $1,026. If the bond carries a call premium equal to one interest payment, what is its yield to call? 8.2% 7.7% 9.5% 10.6%
5 pts Question 8 Which one of the following terms applies to a bond that can be exchanged for the issuing company's common stock in the future? Callable . Municipal Zero coupon Convertible
QUESTION 6 1 poir Bonds that contain a provision that allows the holders to exchange the bonds for other securities of the issuing corporation are called debenture bonds. secured bonds. callable bonds. convertible bonds.
Question 2 1 pts If the terms of a bond issue allow a corporation to redeem the bonds prior to their maturity date, then the bonds are said to contain a(n): capital gains provision interest rate provision call provision 0 put provision 0 coupon provision
Question 23 1 pts A corporate bond has an expected, total (not excess) return of 5%. The risk-free rate is 2% and the expected market return (total, not excess) is 10%. Which of the following is closest to the beta of the corporate bond? 0.3 0.375 0.625 0.5 2.67 Question 22 1 pts Corporation X issues three bonds, A, B, and C, with the same par value, coupon rate, seniority, and maturity. Bond A is convertible, that is it can...
Question 7 1 pts You purchase a bond with an clean price of $1,144. The bond has a coupon rate of 10 percent, and there are 2 months to the next semiannual coupon date. What is the dirty price of the bond? Enter the answer with 2 decimals (eg. 954.23). 1.17733 Question 8 1 pts Ackerman Co. has 11 percent coupon bonds on the market with 9 years left to maturity The bonds make semiannual payments. If the bond currently...
Question 7 2 pts Highland Corp., a U.S. company, has a 7 year bond whose yield to maturity is 4 percent. The bond has no coupon payments but assume semi annual compounding. What is the price of this zero coupon bond? Round the answer to 2 decimal places. Question 8 2 pts Marshall Company is issuing four-year bonds with a coupon rate of 4.5 percent and semiannual coupon payments. If the current market rate for similar bonds is 9.5 percent,...
Bond questions 52018 PART-1-Please SELECT from the choices presented bonds payable callable bond convertible bond Annuities Streams of level (ie, the same amount each pariod) payments occurring on regular 1. intervals An obligation dvded into transtferable units requiring the issuer to make periodic interest payments and an eventual repayment of the face amount, 2. A bond that provides the issuer an option to reacquire the bends before scheduled 3 maturity at a preset price A bond that may be converted...
1. From the standpoint of the issuing company, a disadvantage of using bonds as a means of long-term financing is that A. bond interest is deductible for tax purposes. B. interest must be paid on a periodic basis regardless of earnings. C. income to stockholders may increase as a result of trading on the equity D. the bondholders do not have voting rights. 2. Bonds that mature at a single specified future date are called A. coupon bonds. B. term...
Question 21 1 pts A $1,000 par value 9% annual coupon bond matures in 10 years but is callable in 3 years. The bond is currently selling for $1,026. If the bond carries a call premium equal to one interest payment, what is its yield to call? 8.2% 7.7% 9.5% 10.6%
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