User Account

All Pages

Compute Town Banks annual interest expense

Assignment Help Accounting Basics
Reference no: EM132514764

Question - Town Bank has $500,000 of 8% debenture bonds outstanding. The bonds were issued at 103 in 2018 and mature in 2038. The bonds have annual interest payments.

1. How much cash did Town Bank receive when it issued these bonds?

2. How much cash in total will Town Bank pay the bondholders through the maturity date of the bonds?

3. Calculate the difference between your answers to requirements 1 and 2. This difference represents Town Bank's total interest expense over the life of the bonds.

4. Compute Town Bank's annual interest expense using the straight-line amortization method. Multiply this amount by 20. Your 20-year total should be the same as your answer to requirement 3.

Reference no: EM132514764

Questions Cloud

Unilever on households using palmolive soap : 1. The results of a survey conducted by Unilever on Households using Palmolive soap this year are distributed as follows:
Prepare the journal entries to record pension expense : Cash contributions to pension fund$278,000 Benefit payments to retirees 313,000. Prepare the journal entries to record pension expense
What is the accrued interest for bond : Suppose that a bond is purchased between coupon periods. The days between the settlement date and the next coupon period is 115.
Determine the dollar amount and label : Determine the dollar amount, and label (Favorable or Unfavorable).Mopar Company uses a master budget and subsequent variance analysis.
Compute Town Banks annual interest expense : Compute Town Bank's annual interest expense using the straight-line amortization method. Multiply this amount by 20
Determine the probability of rebecca : A patient is classified as having gestational diabetes if their average glucose level is above 140 milligrams per deciliter (mg/dl) one hour after a sugary
Estimate the standard cost for the direct cost components : Estimate the standard cost for the direct cost components of a 10-gallon batch of raspberry sherbet. For each direct cost component.
Strategic planning in achieving competitive advantage : Describe the role of strategic planning in achieving a competitive advantage. Analyze the strengths and weaknesses of Caterpillar Inc's competitive advantages.
Droid army of the confederacy of the independent systems : When the Republics Clone Army fought the Droid Army of the Confederacy of the Independent Systems, it was reported that 31% of the Droid Army malfunctioned

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd