On January 1, 2023, Larkspur Corporation purchased a newly issued $1,500,000 bond. The bond matured on December 31, 2025, and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Larkspur's fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date. The bond will be accounted using the amortized cost model. Calculate the price paid for the bond using a financial calculator or Excel functions. (Round answers to 2 decimal places, eg. 52.75.) the price paid for the bond is $ 1,421,367.95

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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On January 1, 2023, Larkspur Corporation purchased a newly issued $1,500,000 bond. The bond matured on December 31, 2025, and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Larkspur's fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date. The bond will be accounted using the amortized cost model.

Calculate the price paid for the bond using a financial calculator or Excel functions. (Round answers to 2 decimal places, eg. 52.75.)

the price paid for the bond is $ 1,421,367.95 

 

 
Date
Jan. 1, 2023
June 30, 2023
Dec. 31, 2023
June 30, 2024
Dec. 31, 2024
June 30, 2025
Dec. 31, 2025
Totals
$
$
LA
Cash
Received
LA
$
LA
Interest
Revenue
LA
CA
Discount
Amortization
Transcribed Image Text:Date Jan. 1, 2023 June 30, 2023 Dec. 31, 2023 June 30, 2024 Dec. 31, 2024 June 30, 2025 Dec. 31, 2025 Totals $ $ LA Cash Received LA $ LA Interest Revenue LA CA Discount Amortization
LA
Amortized Cost
(Present Value)
Transcribed Image Text:LA Amortized Cost (Present Value)
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