Homework Answers
Correct answer-----------The bonds were issued at a premium.
.
The interest payment in cash will be $150,000(5000000 x 3%) .
The bond is issued at premium as the cash received is more than par value of bonds. The reason would be that the market interest rate is lower than 6%.
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QUESTION 1 On F ruary 28, 2017, 55,000,000 of 6%, 10-year bonds payable, dated December 31, 2016, are issued. Int...
please solve these for me,thanks! 2016 1. Issued $74,000,000 of 20-year, 11% callable bonds dated July...
please solve these for me,thanks!
2016 1. Issued $74,000,000 of 20-year, 11% callable bonds dated July 1, 2016, at a mar- ket (effective) rate of 13%, receiving cash of $63,532,267. Interest is payable semiannually on December 31 and June 30. 1. Borrowed $200,000 by issuing a six-year, 6% installment note to Nicks Bank. The note requires annual payments of $40,673, with the first payment occurring on September 30, 2017. July Oct. Dec. 31. Accrued $3,000 of interest on the installment...
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Atahualpa Corporation issued $100,000 of 10% bonds dated January 1, 2016, for $96,832.72 on January 1,...
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Quatro Co. issues bonds dated January 1, 2017, with a par value of $870,000. The bonds, annual contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 8%, and the bonds are sold for $892,789 1. What is the amount of the premium on these bonds at issuance? 2. How much total bond interest expense will be recognized over...
please solve these for me,thanks!
2016 1. Issued $74,000,000 of 20-year, 11% callable bonds dated July 1, 2016, at a mar- ket (effective) rate of 13%, receiving cash of $63,532,267. Interest is payable semiannually on December 31 and June 30. 1. Borrowed $200,000 by issuing a six-year, 6% installment note to Nicks Bank. The note requires annual payments of $40,673, with the first payment occurring on September 30, 2017. July Oct. Dec. 31. Accrued $3,000 of interest on the installment...
On 2 January 2016, Platinum Berhad issued 5 % bonds dated 1 January 2016, with a principal amount of RM100,000,000. The bonds will mature in 2035. On the issuance date, for bonds of similar risk and maturity, the market yield is 4%. Interest is paid semiannually on 30 June and 31 December. Compute the issuance price of the bond on 2 January 2016. Show all computations
On 2 January 2016, Platinum Berhad issued 5 % bonds dated 1 January 2016,...
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Legacy issues $710,000 of 8.0%, four year bonds dated January 1, 2017, that pay interest semiannually on June 30 and December 31. They are issued at $621,812 and their market rate is 12% at the issue date. 2. Determine the total bond interest expense to be recognized over the bonds' life. Total bond interest expense over life of bonds: Amount repaid payments of Par value at maturity Total repaid Less amount borrowed Total bond interest expense Legacy issues $710,000 of...
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