The company has made an investment in government bonds. The bonds will generate an interest income of OMR 20878 each year for 6 years. The interest rate is 12% annually. Compute present value of the stream of interest income for 6 years. Select one: a. 85837.96 b. 5078.07 c. All the given choices in this question are not correct d. 106715.96 e. 64959.96

The company has made an investment in government bonds. The bonds will generate an interest income of OMR 20878 each year for 6 years. The interest rate is 12% annually. Compute present value of the stream of interest income for 6 years. Select one: a. 85837.96 b. 5078.07 c. All the given choices in this question are not correct d. 106715.96 e. 64959.96

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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123 456 53. Tea Tree Ltd has acquired some government bonds on 1 July 2022. The government bonds will generate contractual cash flows that are solely principal and interest. The cash flows comprise: B a return of the principal amount of $2 000 000 in five years' time, and . payments of interest of $200 000 at the end of each of the next five years. 7 8 The government bonds were acquired at a price that will generate an effective Interest rate of 6 per cent. That is, they were sold when the market required a rate of return of 6 per cent on government bonds with these cash flow characteristics. 9 The required market rate of return for these government bonds decreased to 5 per cent on 30 June 2023 (which caused the fair value of the bonds to rise). Tax Implications will be ignored for the purposes of answering this question. REQUIRED (a) Determine the initial purchase price of the government bonds on 1 July 2022. (b) Provide the accounting journal entries for the government bonds for the…
Please help me to answer with clear computation the Required 1 and 2 of this Problem. Thank you so much!
The company has made an investment in government bonds. The bonds will generate an interest income of OMR 20623 each year for 6 years. The interest rate is 12% annually. Compute present value of the stream of interest income for 6 years. Select one: O a. 105412.55 O b. 84789.55 Oc. 64166.55 O d. 5016.04 O e. All the given choices in this question are not correct
The company has made an investment in government bonds. The bonds will generate an interest income of OMR 18707 each year for 6 years. The interest rate is 12% annually. Compute present value of the stream of interest income for 6 years. Select one: Oa. 95619.10 Ob. All the given choices in this question are not correct Oc 4550.02 Od. 58205.10 Oe. 76912.10
An indiana state savings bond can be converted to $100 at maturity six years from purchase.If the state bonds pay 8% annula interest (compounded annually),at what price must the state sell its bonds?Assume no cash payments on savings bonds before redemption.
A Corporation has a 6%, $500,000 bond issue that originally was issued 5 years ago. There are now eight years remaining on the bond issue, and the market interest rate is 10%. Interest is paid semiannually. Calculate the current market value of the bond issue, using present value tables. Please label all work.
thank you.
On October 1, 2023, Dejour Energy Inc. issued a $697,000, 10.0%, seven-year bond. Interest is to be paid annually each October 1. Dejour Energy Inc. has a November 30 year - end. (Use TABLE 14A.1 and TABLE 14A.2.). Note: Use table values for PV calculations. (Use appropriate factor(s) from the tables provided.) Required: a. Calculate the issue price of the bond assuming a market interest rate of 12.0% on the date of the bond issue. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar.) b. Using the effective interest method, prepare an amortization schedule. (Do not round intermediate calculations. Round the final answers to the nearest whole dollar. Enter all the amounts as positive values.) Part 1 Record the following entries: (Round your intermediate calculations and final answers to the nearest whole dollar.) Issuance of the bonds on October 1, 2023. Adjusting entry to accrue bond interest and discount amortization on November 30, 2023.…
On January 1, 2022, Nuptam Corp. issued $1,300,000 par value, 8%, 3-year bonds when the market rate of interest was 10%. Interest is payable annually each December 31. Nuptam incurred bond issue costs of $22,000. What is the journal entry when Nuptam issued the bonds? Prepare the amortization table for the bonds. Future Value of $1 table Future Value of an Ordinary Annuity table Future Value of an Annuity Due table Present Value of $1 table Present Value of an Ordinary Annuity table Present Value of an Annuity Due table What is the journal entry when Nuptam issued the bonds? (Record debits first, then credits. Exclude explanations from any journal entries.) January 1, 2022 Account Cash Discount on Bonds Payable Bonds Payable

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