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Present
Bond payable has two types of payments, for the principal and for the interest. To calculate the present value of bonds, the present value of future principal payments and present value of future interest payment are added together. Following formula are used to calculate present value of bonds:
1. Present value of bonds using 14% market interest rate:
To determine:
The present value of bonds payable
2. Present value of bonds using 16% market interest rate:
To determine:
The present value of bonds payable
3. Present value of bonds using 12% market interest rate:
To determine:
The present value of bonds payable
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Chapter 14 Solutions
Horngren's Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (12th Edition)
- Alderon Ltd. has 1,200 defective units of a product that cost $3.50 per unit in direct costs and $7.10 per unit in indirect costs when produced last year. The units can be sold as scrap for $4.80 per unit or reworked at an additional cost of $3.10 per unit and sold at the full price of $13.50. The incremental net income (loss) from the choice of reworking the units would be____.arrow_forwardMangesh Analytics, Inc. sells earnings forecasts for European securities. Its credit terms are 2/15, net 40. Based on experience, 60 percent of all customers will take the discount. What is the average collection period? Need answerarrow_forwardWhat would be the cost per equivalent unit ?arrow_forward
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