at par va Obama Insurance Corporation, Inc., [OIC] issued $18,000,000 of 4% bonds on June 1, 202 The bonds were dated January 1, 2022. The company pays interest on June 30 and December 31 each year. How much will the bond investors need to pay the company in order to purchase these bonds on June 1, 2022 and how much will the bond investors receive in interest on June 30, 2022? [INVESTORS: Pay June 1; Receive June 30] O a. PAY $18,000,000; RECEIVE O b. PAY $17,700,000; RECEIVE OC. PAY $18,000,000; RECEIVE $17,700,000; RECEIVE Od. PAY ****** www. www ***** **** $360,000 $360,000 $720,000 $354,000

at par va Obama Insurance Corporation, Inc., [OIC] issued $18,000,000 of 4% bonds on June 1, 202 The bonds were dated January 1, 2022. The company pays interest on June 30 and December 31 each year. How much will the bond investors need to pay the company in order to purchase these bonds on June 1, 2022 and how much will the bond investors receive in interest on June 30, 2022? [INVESTORS: Pay June 1; Receive June 30] O a. PAY $18,000,000; RECEIVE O b. PAY $17,700,000; RECEIVE OC. PAY $18,000,000; RECEIVE $17,700,000; RECEIVE Od. PAY **** www. www * ** $360,000 $360,000 $720,000 $354,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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BlueLtd. Issued a $1,164,000, 10-year bond dated January 1, 2020. The bond was sold to yield 12% effective interest. The bond paid 10% interest on January 1 and July 1 each year. The company's year-end was December 31, and Blue followed IFRS. Using 1 factor Tables 2. a financial calculator, or 3. Excel function PV, calculate the amount received for the bond, and any discount or premium on the bond. Click here to view the tactor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITYOF 1 (For calculation purposes, use 5 decimal places as displayed in the factor table provided and final answers to 0 decimal places, e.g. 5,275.) Proceeds from sale of bond : on bond Prepare the journal entries for above transactions. (Round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not Indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the…
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40) Scottie Adams Bird Supplies issued 15% bonds, dated January 1, with a face amount of $250,000 on January 1, 2024. The bonds mature in 2033 (10 years). For bonds of similar risk and maturity the market yield is 14%. Interest is paid semiannually on June 30 and December 31. What is the price of the bonds on January 1, 20247 Some relevant and irrelevant present value factors: A) $236,141 B) $291,210 C) $263,243 D) $461,881
Curri, Incorporated sold its 5% bonds with a maturity value of $1,000,000 on August 1, 2021. Investors in the market purchased the bonds for $1,044,915 a price which would earn them a 4% yield on their investment. The difference between the stated and market rates was attributed to revised inflation expectations. The bonds mature on August 1, 2026 and pay interest semi-annually on August 1 and February 1. The bonds are callable at any time after August 1, 2023. Required: C) Assume that Curri was unable to make the required interest payment on February 1, 2023. (NOTE: This assumption should not change your responses to items A) and B) above). The bondholders agreed to accept $800,000 of 2% bonds from Curri in full satisfaction of all claims relating to the 5% bonds. The 2% bonds mature on August 1, 2027 and require interest to be paid quarterly. On February 2, 2023 the 2% bonds were trading in the bond market at 77. How should Curri report the February 1, 2023 swap of the 2% bonds for…
Auerbach Inc. issued 8% bonds on October 1, 2021. The bonds have a maturity date of September 30, 2031 and a face value of $300 million. The bonds pay interest each March 31 and September 30, beginning March 31, 2022. The effective interest rate established by the market was 10%. How much cash interest does Auerbach pay on March 31, 2022? (Round your answer to 2 decimal places.) Top of Form Multiple Choice $24.00 million. $12.00 million. $30.00 million. $15.00 million.
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