A five-year bond loan is issued with an interest rate of 5%, with a nominal value of €20,000,000 and a repayment value of €22,000,000, which is divided into 2000 securities. The bond loan is issued by public registration and the bank's expenses amount to €180,000. Requested: To make the journal entries of issuing the bond loan, assigning it to the bank, paying the interest and paying it off.
Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
A five-year bond loan is issued with an interest rate of 5%, with a nominal value of €20,000,000 and a repayment value of €22,000,000, which is divided into 2000 securities. The bond loan is issued by public registration and the bank's expenses amount to €180,000. Requested: To make the
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