A P1000 000.00 issue of 3%, 15-year bonds is sold at 95% The miscellaneous initial expense of the financing were P20 000 00 and yearly expenses of P2000 00 is incurred What is the true cost the company is paying for the money it borrowed? (Ans. 3.8%)

Q: Crane Company issued $850000 of 8%, 5-year bonds at 109, which pay interest annually. Assuming…

A: Bonds High-security debt instruments known as bonds allow an organization to raise money and meet…

Q: Issue Price - Whitworth International plans to issue $250,000 face value bonds with a stated…

A: Interest = Face value of bond x rate x period

Q: Company XYZ Bank Loan Face Value Maturity (Yrs) 190,000 $ 7 Bond 350,000 10 Interest Expense Cost of…

A: We need to calculate market value of debt for the given information

Q: Bushman, Inc., issues $250,000 of 9% bonds that pay interest semiannually and mature in 10 years.…

A: A bond is a kind of debt security issued by the government and private companies for raising funds…

Q: On 1 January 2010, Quanta Services Inc. issues £1,000,000 face value, five-year bonds with annual…

A: Concept:The practice of accounts used in discounting the bond is called an effective interest…

Q: A debt of $39 comma 000 is repaid over 14 years with payments occurring monthly. Interest is 10%…

A: Periodic payments can be referred as the monthly or annual payments that an investor asks the…

Q: the carrying value of the bonds after one​ year?

A: Here is the calculation for the above question.

Q: Amount issued Offered $340 million Issued at a price of 100.00% plus accrued interest (proceeds to…

A: Format:-   Price of Bond  + Accrued Interest From 1 June to 15 June  Amount to be paid  %

Q: A company issued 10000, 10% debentures of 100 each on 1st April, 2003 to be matured on 1st April,…

A: Market price = 80 Tax rate = 35% Face Value = 100 Coupon = Coupon Rate * Face Value = 10%*100 = 10 N…

Q: If $1,093,000 of 8% bonds are issued at 102 3/4, the amount of cash received from the sale is

A: Given that  $1093000 of 8% Bonds issued at 102 3/4

Q: what is the carrying value of the bonds after one year?

A: Carrying Value of Bonds It is the total of bond's face value and  any un-amortized premiums or…

Q: Cullumber Company issued $510000 of 8% 5-year bonds at 107, which pay interest annually Assuming…

A: Lets understand the basics. There are two method for amortizing bond premium/discount which are, (1)…

Q: On January 1, a company agrees to pay $13,000 in six years. If the annual interest rate is 2%,…

A: Present value (PV) is the current value of a future sum of money or stream of cash flows given a…

Q: ABC Company borrowed $100,000 at a 9% interest rate on May 1, 20X1 for one year with interest and…

A: Solution.     Amount = $100,000  Rate of Interest = 9%  Time period = 8 months (May to December)…

Q: On January 1, a company agrees to pay $12,000 in eight years. If the annual interest rate is 4%,…

A: Present value means the present worth of the money which is to be payable or receivable in the…

Q: Find the Present Value of $14,000 paid at the end of 41 months at a rate of discount of 7%…

A:

Q: Company A has issued $2 million (notional principal) in five-year bonds with a floating (variable)…

A: Interest is the amount paid to the lender by the borrower as a fee for the money borrowed. Interest…

Q: A Corporation sold an issue of 15-year bonds, having a total face value of ₱12,000,000 for…

A: A sinking fund is a means of repayment of funds raised through a bond issue by periodic payment to a…

Q: Find the Present Value of $14,000 paid at the end of 41 months at a rate of discount of 7%…

A:

Q: Dexter Inc. has $1,000,000 in face value bonds with a 6% stated interest rate outstanding. The bonds…

A: Interest Expense = Carrying Value x Effective Interest rate x TimeCash Payment of Interest = Face…

Q: A principal of $12, 000 is 3/5th itself invested at \times % interest rate for 5 years. If the same…

A: Let interest rate be x.We, have Principal (P) = $12,000Interest = P × 3/5 = $12,000 × 3/5 =…

Q: Company X pays interest to the amount of R1 500 a year on total liabilities of R10 000. It can also…

A: The cost of debt is the effective interest rate a company pays on its debts. It’s the cost of debt,…

Financial Ratios

A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.

Return on Equity

The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.