Cop When the market rate of interest was 12%, Halprin Corporation issued $550,000, 11%, 5-year bonds that payinterest annually. The selling price of this bond issue was:Use the following table, if needed.Present Value of $1 at Compound InterestPeriods 5%6%7%12%0.952380.943400.934580.909090.892860.90703 0.890000.873440.826450.797190.863840.83962 0.81630 0.751310.711780.82270 0.79209 0.76290 0.683010.635520.783530.74726 0.712990.620920.567430.746220.70496 0.66634 0.56447 0.506630.710680.665060.62275 0.513160.452350.676840.62741 0.582010.466510.403880.644610.591900.543930.424100.360610.613910.55839 0.50835 0.385540.32197234567812Present Value of an Annuity of $1 at Compound InterestPeriods19391056785%0.952381.859412.723253.545954.329485.075695.786376.463217.107827.7217310a $530,175b. $532,904c. $778,013COd $844.99110%6%10%12%0.892861.690052.401833.037353.604784.111417%0.943400.934580.909091.833391.808021.735542.673012.624322.486853.465113.387213.169874.21236 4.100203.790794.91732 4.766544.355265.582385.389294.868424.563766.209795.971305.334934.967646.801696.515235.759025.328257.360097.02358 6.14457 5.65022

Bonds are debt instruments issued by companies. Bonds pay interest or coupons on a periodic basis…

Answered: When the market rate of interest was…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 10EA: Pinetop Corporation issued $150,000 10-year bonds at par. The bonds have a stated rate of 6% and pay...

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On July 1, Somerset Inc. issued $200,000 of 10%, 10-year bonds when the market rate was 12%. The bonds paid interest semi-annually. Assuming the bonds sold at 58.55, what was the selling price of the bonds? Explain why the cash received from selling this bond is different from the $200,000 face value of the bond.
Krystian Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 4% when the market rate was 6%. Interest was paid semi-annually. Calculate and explain the timing of the cash flows the purchaser of the bonds (the investor) will receive throughout the bond term. Would an investor be willing to pay more or less than face value for this bond?
Charleston Inc. issued $200,000 bonds with a stated rate of 10%. The bonds had a 10-year maturity date. Interest is to be paid semi-annually and the market rate of interest is 8%. If the bonds sold at 113.55, what amount was received upon issuance?
Beluga Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 3% when the market rate was 4%. Interest was paid annually. The bonds were sold at 87.5. What was the sales price of the bonds? Were they issued at a discount, a premium, or at par?
OShea Inc. issued bonds at a face value of $100,000, a rate of 6%, and a 5-year term for $98,000. From this information, we know that the market rate of interest was ________. A. more than 6% B. less than 6% C. equal to 6% D. cannot be determined from the information given.
Gingko Inc. issued bonds with a face value of $100,000, a rate of 7%, and a 10-yearterm for $103,000. From this information, we know that the market rate of interest was ________. A. more than 7% B. less than 7% C. equal to 7% D. equal to 1.3%
A company issued bonds with a $100,000 face value, a 5-year term, a stated rate of 6%, and a market rate of 7%. Interest is paid annually. What is the amount of interest the bondholders will receive at the end of the year?
Chung Inc. issued $50,000 of 3-year bonds on January 1, 2018, with a stated rate of 4% and a market rate of 4%. The bonds paid interest semi-annually on June 30 and Dec. 31. How much money did the company receive when the bonds were issued? The bonds would be quoted at what rate?
Issue Price The following terms relate to independent bond issues: 500 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments 500 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments 800 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments 2,000 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments Required Assuming the market rate of interest is 10%, calculate the selling price for each bond issue.
Pinetop Corporation issued $150,000 10-year bonds at par. The bonds have a stated rate of 6% and pay interest annually. What is the journal entry to record the sale of the bonds?
Evie Inc. issued 50 bonds with a $1,000 face value, a five-year life, and a stated annual coupon of 6% for $980 each. What is the total amount of interest expense over the life of the bonds?
Piedmont Corporation issued $200,000 of 10-year bonds at par. The bonds have a stated rate of 6% and pay interest annually. What is the journal entry to record the first interest payment to the bondholders?

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