Carrie's Clothes, Inc. has a four-year bond outstanding that pays $50 annually. The face value of each bond is $1,000, and the bond sells for $920. a. What is the bond's coupon rate? Round your answer to two decimal places. % b. What is the current yield? Round your answer to two decimal places. % c. What is the yield to maturity? Use Appendix B and Appendix D to answer the question. Round your answer to the nearest whole number. %
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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