Answered: A Php 50,000 bond with rate of 8%…

A Php 50,000 bond with rate of 8% annually pays dividend quarterly is redeemable at par at the end of 10 years. Determine the present worth if the bond pays 12% compounded annually?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 3EA: Krystian Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 4% when the...

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Concept explainers

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:

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A Php 50,000 bond with rate of 8% annually pays dividend quarterly is
redeemable at par at the end of 10 years. Determine the present worth if
the bond pays 12% compounded annually?

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