Calculate the selling price of the following 5-year bond issue:e.# bondsBond rate of interestInterest payableMarket rate of interestBond maturity (face) value6005.8%semi-annually6.0%$1,000

The objective of this question is to calculate the selling price of a bond issue. The bond issue…

Answered: Calculate the selling price of the…

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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5 On January 1, Ruiz Company issued bonds as follows: Face Value: Number of Years: Stated Interest Rate: Interest payments per year 7 B 9 0 1 2 AWN IC $500,000 a) Required: 1) Calculate the bond selling price given the two market interest rates below. Use formulas that reference data from this worksheet and from the appropriate future or present value tables (found by clicking the tabs at the botto this worksheet). Note: Rounding is not required. 15 7% 2 Annual Market Rate Semiannual Interest Payment: PV of Face Value: +PV of Interest Payments: Bond Selling Price: Annual Market Rate Semiannual Interest Payment: PV of Face Value: +PV of Interest Payments: = Bond Selling Price: 9% $17,500 133,500.01 285,055.55 418,555.56 6.00% $17,500 205,993.38 5343,007.72 $549,001.10 +
A $5000 bond bearing interest at 3.4% payable semi-annually is due in 12 years. Money is worth 8.0% compounded semi-annually. What is the bond rate? a. 8.0% compounded semi-annually b. 3.4% payable semi-annually
bond contract rate =7% semi- anual bond -$10,000 bond market =6% semi annual bond life = 10 years 1) find the selling price of this bond 2) will it be sold at a discount or premium 3) do the journal entry for the issuance 4) calculate the discount/premium authorization per period (use the slightline method ) 5) do the entry for the payment of cash interest period 6) do the entry for the amortization of the discount /premium per period 7)find total interest expense per period 8) show the balance sheet presentation of the bond after two periods have elapsed
A 15-year bond issue of 4 comma 900 comma 000 and bearing interest at 3.5% payable annually is sold to yield 3.1% compounded semi dash annually. What is the issue price of the bonds?
Use the following tables to calculate the present value of a $375,000 @ 5%, 5-year bond that pays $18,750 interest annually, if the market rate of interest is 10%. Round to the nearest dollar. Present Value of $1 ¦ Present Value of Annuity of $1 Periods 5 % 6 % 7 % 10 % ¦ Periods 5 % 6 % 7 % 10 % 1 .95238 .94340 .93458 .90909 ¦ 1 .95238 .94340 .93458 .90909 2 .90703 .89000 .87344 .82645 ¦ 2 1.85941 1.83339 1.80802 1.73554 3 .86384 .83962 .81630 .75131 ¦ 3 2.72325 2.67301 2.62432 2.48685 4 .82270 .79209 .76290 .68301 ¦ 4 3.54595 3.46511 3.38721 3.16987 5 .78353 .74726 .71299 .62092 ¦ 5 4.32948 4.21236 4.10020 3.79079 6 .74622 .70496 .66634 .56447 ¦ 6 5.07569 4.91732 4.76654 4.35526 7 .71068 .66506 .62275 .51316 ¦ 7 5.78637 5.58238 5.38929 4.86842 8 .67684 .62741 .58201 .46651 ¦ 8 6.46321…
Determine the price of a $1.9 million bond issue under each of the following independent assumptions: Maturity 10 years, interest paid annually, stated rate 6%, effective (market) rate 9%. Maturity 10 years, interest paid semiannually, stated rate 6%, effective (market) rate 9%. Maturity 10 years, interest paid semiannually, stated rate 9%, effective (market) rate 6%. Maturity 20 years, interest paid semiannually, stated rate 9%, effective (market) rate 6%. Maturity 20 years, interest paid semiannually, stated rate 9%, effective (market) rate 9%.
Boxer Corp is issuing $600,000 8% 5 year bonds when bond investors want a return of 10%. Interest is payable semiannually Caculate Present Value of Bond Calculate Present Value of Interest Payments What is selling price of bond? did the bond sell at face value discount or premium?
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Listen A $5,000 bond paying interest at j-6%, redeemable at par on April 1, 2009 is priced at $4,600 on April 1, 2002. Find the yield rate to 2 decimal places. Show your work in your workbook. Your Answer: Answer
Use the following tables to calculate the present value of a $608,000 @ 6%, 6-year bond that pays $36,480 interest annually, if the market rate of interest is 7%. Round to the nearest dollar. Present Value of $1 ¦ Present Value of Annuity of $1 Periods 5 % 6 % 7 % 10 % ¦ Periods 5 % 6 % 7 % 10 % 1 .95238 .94340 .93458 .90909 ¦ 1 .95238 .94340 .93458 .90909 2 .90703 .89000 .87344 .82645 ¦ 2 1.85941 1.83339 1.80802 1.73554 3 .86384 .83962 .81630 .75131 ¦ 3 2.72325 2.67301 2.62432 2.48685 4 .82270 .79209 .76290 .68301 ¦ 4 3.54595 3.46511 3.38721 3.16987 5 .78353 .74726 .71299 .62092 ¦ 5 4.32948 4.21236 4.10020 3.79079 6 .74622 .70496 .66634 .56447 ¦ 6 5.07569 4.91732 4.76654 4.35526 7 .71068 .66506 .62275 .51316 ¦ 7 5.78637 5.58238 5.38929 4.86842 8 .67684 .62741 .58201 .46651 ¦ 8 6.46321…
A corporate bond has 23 years to maturity, a face value of $1,000, a coupon rate of 5.5%, and pays interest semiannually. The annual market interest rate for similar bonds is 3.3%. Part 1 What is the value of the bond? 0+ decimals
Determine the market price of a $209,000, ten-year, 8% (pays interest semiannually) bond issue sold to yield an effective rate of 10%. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to O decimal places, e.g. 458,581.) Click here to view factor tables Market price of bond issue $

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Calculate the selling price of the following 5-year bond issue: e. # bonds Bond rate of interest Interest payable Market rate of interest Bond maturity (face) value 600 5.8% semi-annually 6.0% $1,000