On January 1, 2019,CalderetaCompany purchased 5-year bonds with face value of P8,000,000 and stated interest of 10% per year payable semi-annually January 1 and July 1.The bonds were acquired to yield 8%.  Assuming that the bonds pay interest annually every December 31 (instead of semi-annually), all other data being the same, how much is the bond price?(Use 3-decimal places)

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Q: On January 1, 2019, Drennen Inc. issued $5 million face amount of 10-year, 14% stated rate bonds…

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A: The objective of the question is to determine the effective interest rate of the bonds sold by…

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A: The effective interest rate is the return on a savings account or interest-paying investment. The…

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A: Bonds refer to borrowing security issued by the company to raise funds from the market by making an…

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A: Bond Price :— It is sum of present value of periodic interest payment and face value amount.    If…

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Q: On January 1, 2018, Wauwatosa Inc. issued 5- year bonds with a fave value of $200,000 and a stated…

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Q: On January 1, 2021, Bishop Company issued 10% bonds dated January 1, 2021, with a face amount of $20…

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A: If you have any clarifications (i.e., expand the explanation) or want different, expanded, or…

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A: The question is based on the concept of Financial Accounting.

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Q: On January

A: Bonds are priced by discounting future cash flows. Future cash flows include coupons and par value…

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Q: 2025, and mature January 1, 2030. Interest is payable annually on January 1. Click here to view…

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Q: At January 1, 2020, Konerko Corp. issued $40,000,000 of 6%, 12-year bonds that paid interest…

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Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.