Allegiant issues 6%, 20-year bonds with a par value of $2,000,000 and semiannual interest payments. In each separate situation,determine whether the bond is issued at par value, at a discount, or at a premium.Situation1. Market rate for the bond is 5%.2. Market rate for the bond is 6%.3. Market rate for the bond is 7%.Bond issued

YTM (yield to maturity) is the total return anticipated on a bond if it is held until its maturity…

Answered: Allegiant issues 6%, 20-year bonds with…

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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Krystian Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 4% when the market rate was 6%. Interest was paid semi-annually. Calculate and explain the timing of the cash flows the purchaser of the bonds (the investor) will receive throughout the bond term. Would an investor be willing to pay more or less than face value for this bond?
What the answer for question 18 and 19?
answer is A: how do you get to this answers?
On January 1, Year 1, Denver Company issued bonds with a face value of $87,000, a stated rate of interest of 8%, and a 5-year term to maturity. The bonds were sold at 102.5. Denver uses the straight-line method to amortize bond discounts and premiums. What is the amount of interest expense during Year 1? Multiple Choice O O O O $7,134 $6,960 $7,395 $6,525
If bonds are issued at 101.25, this means thata. a $1,000 bond sold for $1,012.50.b. a $1,000 band sold for $101.25.c. the bonds sold at a discount.d. The bond rate of interest is 10.125% of the market rate of interest.
7.
If you could explain how you solved for it, I would appreciate it.
On January 1, Year 1, Denver Company issued bonds with a face value of $89,000, a stated rate of interest of 9%, and a 5-year term to maturity. The bonds were sold at 103. Denver uses the straight-line method to amortize bond discounts and premiums. What is the amount of interest expense during Year 1? Multiple Choice O оо $8,544 $8,010 $8,250 $7,476
Two bonds have par values of $1,000. Bond A is a 5% quarterly-pay, 15-year bond priced to yield 8% as an annual rate; the other (Bond B) is a 7.5% quarterly-pay, 20-year bond priced to yield 5.86% as an annual rate. The values of these two bonds would be: Bond A Bond B A. $739.29 $1,174.03 B. $740.61 $1,172.04 C. $739.29 $1,192.04
Based on Question No. 1, I want answer of Question No. 2 On September 1, Deutsch Limited issues 8%, 5-year bonds payable with a maturity value of OR 20,000. The bonds sell at 98 and pay interest on March 1 and September Deutsch amortize bond discount by the straight-line method. Required: Journalize the issuance of the bonds on September 1, and the semiannual interest payment on March 1 and September 1. Answer: Bonds: Bonds are a kind of interest-bearing notes payable, usually issued by companies, universities, and governmental organizations. It is a debt instrument used for the purpose of raising a fund of the corporations or governmental agencies. If selling price of the bond is equal to its face value, it is called as par on bond. If the selling price of the bond is lesser than the face value, it is known as a discount on bond. If the selling price of the bond is greater than the face value, it is known as premium on bond. 2. What are the two categories of liabilities…
On January 1, Nic Inc. issued $100,000 of ten-year, 10% bonds that pay interest semiannually on June 30 and 31st. The bonds are sold to yield 8%. A. Using the information provided in this problem, as well as your time value of money tables to calculate the issue price of the bond. B. Was the bond issued at a premium or a discount, explain your answer.
The following data relate to a $2,000,000, 8% bond issued for a selected semiannual interest period: Bond carrying amount at beginning of period $2,125,000Interest paid during period 160,000 Interest expense allocable to the period 148,750 (a) Were the bonds issued at a discount or at a premium? (b) What is the unamortized amount of the discount or premium account at the beginningof the period? (c) What account was debited to amortize the discount or premium?

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