mature in 2040 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid semiannually.
mature in 2040 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid semiannually.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Ya.4
On January 1, 2019, Bradley, Inc., issued 12% bonds with a face amount of $66 million, dated January 1. The bonds mature in 2040 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid semiannually.
Instructions
1. Determine the price of the bonds at January 1, 2019, and prepare the
2. Assume the market rate was 8,5%. Determine the price of the bonds at January 1, 2018, and prepare the journal entry to record their issuance by Bradley.
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