Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
3. A company issued 100 bonds of₱1,000 face value each, redeemable at par at the end of 15 years. To accumulate the funds for redemption, the firm established a sinking fund consisting of annual deposits, the interest rate of the fund is 5%. What was the principal in the fund at the end of the 12thyear?
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