A company issued 7%, 20-year bonds with a face amount of $82 million. The market yield for bonds of similar risk and maturity is 8%.Interest is paid semiannually. At what price did the bonds sell?Note: Do not round intermediate calculations and round you final answer to nearest whole dollar. Use tables, Excel, or a financialcalculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)Price of bonds........

The bonds are issued either by government entities or by corporations to raise money for the long…

Answered: A company issued 7%, 20-year bonds with…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Essex Biochemical Company has a $1,000 par value bond outstanding that pays 10 percent annual interest. The current yield to maturity on such bonds in the market is 8 percent. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. Compute the price of the bonds for the maturity dates: Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. Assume interest payments are annual. a: 30 years b: 16 years c: 1 years
Kellogg issued 20-year bonds. which of the following ratios will the bondholders most likely monitor to assess the Kellogg's ability to make its payments? Times interest earned ratio inventory turnover return on assets capital intensity ratio profit margin
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On January 1 of this year, Clearwater Corporation sold bonds with a face value of $780,000 and a coupon rate of 9 percent. The bonds mature in 10 years and pay interest annually every December 31. Clearwater uses the straight-line amortization method and does not use a discount account. Assume an annual market rate of interest of 10 percent. (EY of $1. PV of $1. EVA of $1. and PVA of $1) Note: Use appropriate factor(s) from the tables provided. Required: 1.82. Prepare the journal entry to record the issuance of the bonds and the interest payment on December 31 of this year. 3. What bonds payable amount will Clearwater report on its December 31 balance sheet? Complete this question by entering your answers in the tabs below. Required 1 and 2 Required 3 Prepare the journal entry to record the issuance of the bonds and the interest payment on December 31 of this year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.…
The notes to the Thorson Ltd.financial statements reported the following data on December 31, Year 1 (end of the fiscal year): Thorson amortizes bond discounts using the effective-interest method and pays all interestamounts at December 31. Requirements1. Assume the market interest rate is 6% on January 1 of year 1, the date the bonds are issued.a. Using the PV function in Excel, what is the issue price of the bonds?b. What is the maturity value of the bonds?c. What is Thorson’s annual cash interest payment on the bonds?d. What is the carrying amount of the bonds at December 31, year 1?2. Prepare an amortization table through the maturity date for the bonds using Excel. (Roundall amounts to the nearest dollar.) How much is Thorson’s interest expense on the bonds forthe year ended December 31, Year 4?3. Show how Thorson would report these bonds and notes at December 31, Year 4.
A company issued 5%, 20-year bonds with a face amount of $80 million. The market yield for bonds of similar risk and maturity is 6%. Interest is paid semiannually. At what price did the bonds sell?
Determine the interest payment for the following three bonds. (Assume a $1,000 par value.) (Round your answers to 2 decimal places.) 1. 3 % percent coupon corporate bond (paid semiannually): 2. 4.25 percent coupon Treasury note (paid semiannually):
aa.2 A company issued 8%, 10-year bonds with a face amount of $100 million. The market yield for bonds of similar risk and maturity is 4%. Interest is paid semiannual. At what price did the bonds sell? NOTE: Do not round intermediate calculations. Round your final answer to the nearest whole dollar.
Find the total proceeds (in $) from the sale of 30 bonds with a coupon rate of 8.75 and a current price of 96.575. (Round your answer to the nearest cent.) The commission charge is $6.00 per bond. The date of the transaction is 145 days since the last interest payment. 2$
You are analyzing the cost of debt for a firm. You know that the firm's 14-year maturity, 8.6 percent coupon bonds are selling at a price of $832.00. The bonds pay interest semiannually. If these bonds are the only debt outstanding, answer the following questions. Problem 13.17 a1-a2(a1) Your answer is incorrect. What is the current YTM of the bonds? (Round intermediate calculations to 4 decimal places, e.g. 1.2514 and final answer to O decimal places, e.g. 15%.) Current YTM for the bonds %
Find the total proceeds (in $) from the sale of 30 bonds with a coupon rate of 8.75 and a current price of 96.575. (Round your answer to the nearest cent.) The commission charge is $6.00 per bond. The date of the transaction is 145 days since the last interest payment. $2821.53 x
A company issued 9%, 15-year bonds with a face amount of $100 million. The market yield for bonds of similar risk and maturity is 8%. Interest is paid semiannually. At what price did the bonds sell?

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