A UM issued 54 bonds of ₱1,500 face value each, redeemable at par at the end of 15 years. To accumulate the funds required for redemption, the firm established a sinking fund consisting of annual deposits, the interest rate of the fund being 5%. What was the principal in the fund at the end of the 10th year?

A UM issued 54 bonds of ₱1,500 face value each, redeemable at par at the end of 15 years. To accumulate the funds required for redemption, the firm established a sinking fund consisting of annual deposits, the interest rate of the fund being 5%. What was the principal in the fund at the end of the 10th year?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Prepare the journal entry for the following bond issuance in the capital project fund. 20 year, 4%, General Obligation Serial Bonds with a face value of $5,000,000 are issued at 102. Interest and payments are made on Jan. 1 and July 1 of each year. The principal payment is made once a year starting 1/1/YR5. The premium was transferred into the Debt Service Fund. The General Fund will fully fund each payment as they become due. Account debited Account credited Amount debited Cash OFS Transfers Out - OFS Bond Proceeds. Expenditures Premium Fund Balance 5,100,000 100,000 Amount credited 5,000,000 100,000 100,000
4. Compute the annual cost for interest and redemption of these bonds
A Corporation sold an issue of 20-year bonds, having a total face value of 22M for 9,500,000. The bonds bear interest at 16%, payable semiannually. The company wishes to establish a sinking fund for retiring the bond issue and will make semiannual deposit that will earn 12%, compounded semiannually. Compute the annual cost for interest and redemption of these bonds.
3. A company issued 100 bonds of₱1,000 face value each, redeemable at par at the end of 15 years. To accumulate the funds for redemption, the firm established a sinking fund consisting of annual deposits, the interest rate of the fund is 5%. What was the principal in the fund at the end of the 12thyear?
a corporation sold an issue of 15 years bonds having a total face value of 12,000,000 for 11,000,000. the bond bear interest 15% payable semiannually . the company wishes to established a sinking fund for retiring the bond issue and will make semiannual deposit that will earn 12% compunded seminuannually. show the cash flow diagram and compute the annual costfor interest and redemption of these bond.
Oak Branch Inc. issued $900,000 of 5%, 10-year bonds when the market rate was 4%. They received $973,595. Interest was paid semi-annually. Prepare an amortization table for the first three years of the bonds. Round intermediate and final answers to whole dollar amount. Jan. 1, Year 1 June 30, Year 1 Dec. 31, Year 1 June 30, Year 2 Dec. 31, Year 2 June 30, Year 3 Dec. 31, Year 3 Cash Interest Payment ✔ 22,500 22,500 ✓ 22,500 ✔ 22,500 ✔ 22,500 ✓ 22,500 ✓ Interest on Carrying Value 19,472 19,411 V ✓ 19,350 ✔ 19,287 ✔ 19,222 ✔ 19,157 ✔ Amortization of Premium 3,028 3,089 3,150 ✔ ✓ 3,213 3,278 ✓ 3,343 ✔ Carrying Value 973,595 970,567 967,478 ✔ 964,328 ✔ 961,114 X 957,837 ✔ 954,493 X
Sepia Inc. issued $350,000 bonds that were redeemable in 7 years. They established a sinking fund that was earning 5.50% compounded semi-annually to pay back the principal of the bonds on maturity. Deposits were being made into the fund at the end of every 6 months. a. Calculate the size of the periodic sinking fund deposits. b. Calculate the sinking fund balance at the end of the 4th payment period. c. Calculate the amount of interest earned during the 5th payment period. d. Calculate the amount by which the sinking fund increased in the 5th payment period.
Blossom Company issued $700,000, 9-year bonds. It agreed to make annual deposits of $75,500 to a fund (called a sinking fund), which will be used to pay off the principal amount of the bond at the end of 9 years. The deposits are made at the end of each year into an account paying 4% annual interest. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What amount will be in the sinking fund at the end of 9 years? (Round answer to 2 decimal places, e.g. 25.25.) Amount in the sinking fund $ 803100.94
A Corporation has a 6%, $500,000 bond issue that originally was issued 5 years ago. There are now eight years remaining on the bond issue, and the market interest rate is 10%. Interest is paid semiannually. Calculate the current market value of the bond issue, using present value tables. Please label all work.
Company G has outstanding bonds with a face value of $1,000,000 and a stated interest rate of 5%. The bonds pay interest semi-annually and have 10 years remaining until maturity. Calculate the total interest expense for the year.
Sepia Inc. issued bonds for $450,000 that were redeemable in 6 years. They established a sinking fund that was earning 4.87% compounded semi-annually to pay back the principal of the bonds on maturity. Deposits were being made to the fund at the end of every 6 months. a. Calculate the size of the periodic sinking fund deposit. b. Calculate the sinking fund balance at the end of the payment period 8. c. Calculate the interest earned in payment period 9. d. Calculate the amount by which the sinking fund increased in payment period 9.
Oriole Company issued $1,000,000, 9-year bonds. It agreed to make annual deposits of $77,500 to a fund (called a sinking fund), which will be used to pay off the principal amount of the bond at the end of 9 years. The deposits are made at the end of each year into an account paying 9% annual interest. Click here to view the factor table. What amount will be in the sinking fund at the end of 9 years? (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round answer to 2 decimal places, eg. 25.25) Amount in the sinking fund $

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