Spiller Corporation plans to issue 10%, 8-year, $600,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated January 1 of the current year and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is 8% on the date of issue, what will be the total cash proceeds from the bond issue? Table Values are Based on: Cash Flow Present (maturity) value Interest (annuity) Total cash proceeds n = i= Table Value Amount Present Value

Spiller Corporation plans to issue 10%, 8-year, $600,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated January 1 of the current year and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is 8% on the date of issue, what will be the total cash proceeds from the bond issue? Table Values are Based on: Cash Flow Present (maturity) value Interest (annuity) Total cash proceeds n = i= Table Value Amount Present Value

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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Coronado Inc. issued $920,000 of 10%, 10-year bonds on June 30, 2025, for $814,472. This price provided a yield of 12% on the bonds. Interest is payable semiannually on December 31 and June 30. If Coronado uses the effective-interest method, determine the amount of interest expense to record if financial statements are issued on October 31, 2025. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548.) Interest expense to be recorded
Lisa Anderson Company issued $516,000 of 10%, 20-year bonds on January 1, 2025, at 102. Interest is payable semiannually on July 1 and January 1. Lisa Anderson Company uses the effective-interest method of amortization for bond premium or discount. Assume an effective yield of 9.7705% Click here to view factor tables. Prepare the journal entries to record the following. (Round intermediate calculations to 6 decimal places, eg. 1.251247 and final answer to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) a. The issuance of the bonds. b. The payment of interest and related amortization on July 1, 2025. с The accrual of interest and the related amortization on December 31, 2025. Date Account Titles and Explanation Debit Credit
On January 1, 2024, Christmas Anytime issues $850,000 of 6% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. Assume that the market interest rate is 7% and the bonds issue at a discount.2a. Calculate the issue price of a bond.2b. Complete the first three rows of an amortization schedule. (FV of $1, PV of $1, FVA of $1, and PVA of $1)
Crane Company issued $255,000 , 7%, 10-year bonds on January 1, 2022, for $273,767 . This price resulted in an effective-interest rate of 6% on the bonds. Interest is payable annually on January 1. Crane uses the effective-interest method to amortize bond premium or discount. (a) Prepare the journal entry to record the issuance of the bonds. (Round answers to decimal places, e.g. 15,250 . Credit account titles are automatically indented when amount is entered . Do not indent manually
Determine the bond issue proceeds for each of the following bonds payable. All bonds are issued on January 1, 2023. a. Brandy Corporation issued bonds in the amount of $1,290,000 that will be paid in 3 years. Interest of $38,700 is payable semiannually each June 30 and December 31 with the first interest payment at the end of the first period on June 30, 2023. If the market rate of interest is 10%, what is the amount of the bond issue proceeds? (Use the present value and future value tables, a financial calculator, or a spreadsheet for your calculations. If using present and future value tables or the formula method, use factor amounts rounded to five decimal places, X.XXXXX. Round your final answer to the nearest cent, $X.XX.) B. Tandy Corporation issued bonds in the amount of $4,400,000 that will be paid in nine years. Interest of $132,000 is payable semiannually each June 30 and December 31 with the first interest payment at the end of the first period on June 30,…
On March 1, 2024, Baddour, Incorporated, issued 10% bonds, dated January 1, with a face amount of $160 million. • The bonds were priced at $143.50 million (plus accrued Interest) to yield 12%. • The price if Issued on January 1 would have been $140.75 million. Interest is paid semiannually on June 30 and December 31. • Baddour's fiscal year ends September 30. Required: 1. to 3. What would be the amount(s) related to the bonds Baddour would report in its balance sheet, Income statement and statement of cash flows for the year ended September 30, 2024? Note: Enter your answers in whole dollars. Negative amounts should be indicated by a minus sign. Balance sheet: Bonds payable (net) Cash Income statement: Interest expense Statement of cash flows: Financing activities Operating activities
On January 1, 2024, White Water issues $490,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 7% and the bonds issued at $535,061. Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $529,343 on December 31, 2026. (Round your final answers to the nearest whole dollar.)
On September 30, 2024, the Techno Corporation issued 8% stated rate bonds with a face amount of $500 million. The bonds mature on September 30, 2044 (20 years). The market rate of interest for similar bonds was 10%. Interest is paid semiannually on March 31 and September 30. Required: Determine the price of the bonds on September 30, 2024. Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount, not in millions. (FV of $1. PV of $1, FVA of $1, PVA of $1. FVAD of $1 and PVAD of $1) Time values are based on: Cash Flow Interest Principal Price of bonds Amount Present Value
A company issues 8%, two-year bonds on December 31, 2018, with a par value of $10,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 10%, which implies a selling price of 96.0% or $9,600. (a) Prepare an amortization table for these bonds; use the straight-line method to amortize the discount. Then prepare journal entries to record; (b) The issuance of bonds on December 31, 2018; (c) The first interest payments on each June 30 and December 31; and (d) The maturity of the bond on December 31, 2020.
Queen Energy Inc. issued bonds on January 1, 2023, that pay interest semiannually on June 30 and December 31. The par value of the bonds is $200,000, the annual contract rate is 12%, and the bonds mature in 10 years. (Use TABLE 14A.1 and TABLE 14A.2.) (Use appropriate factor(s) from the tables provided.) Required: a. For each of these three situations, determine the issue price of the bonds. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.) b. For each of these three situations, prepare the journal entry that would record the issuance, assuming the market interest rate at the date of issuance was (1) 10%, (2) 12%, (3) 14%. (Use PV tables in determining the issue price of the bonds. Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)
Concord Inc. issues $ 2,300,000 of 7% bonds due in 12 years with interest payable at year-end. The current market rate of interest for bonds of similar risk is 10%. What amount will Concord receive when it issues the bonds? (For calculation purposes, use 5 decimal places as displayed in the factor table provided and final answer to 0 decimal places, e.g. 458,581.)
On June 30, 2024, Single Computers issued 5% stated rate bonds with a face amount of $280 million. The bonds mature on June 30, 2039 (15 years). The market rate of interest for similar bond issues was 4% (2.0% semiannual rate). Interest is paid semiannually (2.5%) on June 30 and December 31, beginning on December 31, 2024. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Required: 1. Determine the price of the bonds on June 30, 2024. 2. Calculate the interest expense Single reports in 2024 for these bonds using the effective interest method.

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