ril 1, 2028, A Company purchased three units of baking equipment by issuing a four-year, non-interest bearing, P 3,200,000 note. The note is payable in annual installments of P 800,000. The first installment is due on March 31, 2029. There was no equivalent cash price for the equipment and the note had no ready market. The prevailing interest rate for a note of this type is 9%. The present value of 1 factor at 9% for 4 periods is 0.7084 and present value of ordinary annuity factor at 9% for 4 periods is 3.2397. At what amount should the note be recorded on April 1, 2028? On January 1, 2021, a company issued a 10% 5-year bonds with face value of P8,000,000. Interest is payable semi- annually every January 1 and July 1. The bonds were issued to yield 8%. How much is the carrying value of the bonds on December 31. 2
ril 1, 2028, A Company purchased three units of baking equipment by issuing a four-year, non-interest bearing, P 3,200,000 note. The note is payable in annual installments of P 800,000. The first installment is due on March 31, 2029. There was no equivalent cash price for the equipment and the note had no ready market. The prevailing interest rate for a note of this type is 9%. The present value of 1 factor at 9% for 4 periods is 0.7084 and present value of ordinary annuity factor at 9% for 4 periods is 3.2397. At what amount should the note be recorded on April 1, 2028? On January 1, 2021, a company issued a 10% 5-year bonds with face value of P8,000,000. Interest is payable semi- annually every January 1 and July 1. The bonds were issued to yield 8%. How much is the carrying value of the bonds on December 31. 2
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
Section: Chapter Questions
Problem 1PS
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On April 1, 2028, A Company purchased three units of baking equipment by issuing a four-year, non-interest bearing, P 3,200,000 note. The note is payable in annual installments of P 800,000. The first installment is due on March 31, 2029. There was no equivalent cash price for the equipment and the note had no ready market. The prevailing interest rate for a note of this type is 9%. The present value of 1 factor at 9% for 4 periods is 0.7084 and present value of ordinary annuity factor at 9% for 4 periods is 3.2397. At what amount should the note be recorded on April 1, 2028?
On January 1, 2021, a company issued a 10% 5-year bonds with face value of P8,000,000. Interest is payable semi- annually every January 1 and July 1. The bonds were issued to yield 8%. How much is the carrying value of the bonds on December 31. 2021?
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