Find the face value using given data

Assignment Help Accounting Basics
Reference no: EM132213950

Question: Consider two bonds: 1) a zero-coupon bond having a face value F and maturity 1 year; 2) a coupon bond with face value F, coupons C = 15 paid annually and maturity 3 years. Assume that the continuously compounded interest rate is 10%.

a) If F = 100, find at the end of which year the price of the second bond will be for the first time below 110?

b) If the price of the second bond is equal to 1.20 times the price of the first bond, find the (common) face value F ? (Round to the nearest thousandth)

Reference no: EM132213950

Questions Cloud

Explain what you think went wrong : Dr. Jakob Nielsen has said that mobile CX is an oxymoron. In order to determine whether you agree with his statement, think of one instance of excellent mobile.
Determine the cash value of hershey company : Determine the Cash Value of Hershey Company Purpose It is simply good business to continually know the cash value (corporate valuation) of your company
Prepare any note disclosures and adjusting journal entries : Prepare any note disclosures and adjusting journal entries that are needed in the 2018 financial statements for each situation.
What is the notional value of your position : Suppose the S&P-500 index futures price is currently 950 (with a contract multiplier of $250), What is the notional value of your position
Find the face value using given data : If the price of the second bond is equal to 1.20 times the price of the first bond, find the (common) face value F ? (Round to the nearest thousandth)
Compute the missing numbers identified by question marks : The flowchart below shows the August production activity of the punching and bending department of Wire Box Company. Use the amounts shiwn on the flowchart.
Determine four activity rates : Ralph Inc. is considering a time-driven activity-based costing system. Determine four activity rates
Explain the elements of negligence : Explain the elements of negligence. Who is negligent in this case and why? Explain the possible defenses, if any, the train company could use if the owner.
Compute the predetermined overhead rate : Required: Compute the predetermined overhead rate assuming that Tiger Furnishings uses direct labor costs to allocate overhead costs

Reviews

Write a Review

Accounting Basics Questions & Answers

  Prepare necessary adjusting entries at december

Prepare necessary adjusting entries at December 31 to record amortization required by the events above

  Record the journal entries to write down the inventory

Assuming the company's normal profit margin is 15%, record the journal entries to write down the inventory under a) IFRS and b) US GAAP

  Prepare appropriate entries

Prepare appropriate entries for both IGA and Elf Leasing from the inception of the lease through the second rental payment on April 1, 2016

  Prepare dold''s journal entries for the initial transaction

Prepare Dold's journal entries for the initial transaction, recognition of interest each year, and the collection of $35,843 at maturity. (Round answers to 0 decimal places, e.g. $6,538. Credit account titles are automatically indented when the am..

  Calculate elaine''s current basis in her partnership interest

Elaine's original basis in the Hornbeam Partnership was $25,000. Her share of the taxable income from the partnership since she purchased the interest has been $100,000, and Elaine has received $75,000 in cash distributions from the partnership

  Prepare the amortization schedule for the bonds

On January 1, 2010, Novotna Company purchased $400,000, 8% Bonds of Aguirre Co. for $369,114. Prepare the amortization schedule for the bonds

  Prepare the necessary adjustments for service

During the month of August, deposits in the mount s of $1,100 were received fir services to be performed. Prepare the necessary adjustments for service revenue

  Using the fifo basis prepare a process costing report

PNG Corporation designs and builds roller coasters for amusement parks.  At the end of 20x1, managers estimated overhead costs for 20x2 of $150,000 based on expected production of 5 roller coasters (5 jobs) using 5,000 labor hours each.  Actual ov..

  Compute the amount of cash collected in 2012 on accounts

Prepare the adjusting entry or entries required on December 31, 2012 to recognize 2012 realized gross profit. (Installment receivables have already been credited for cash receipts during 2012.)

  Determine the assets to revenues ratio

Determine the assets to revenues ratio for the construction company in Figures 6-1 and 6-2. What insight does this give you into the company's financial.

  Production of goods-services

The production of any goods or services requires the allocation of resources that otherwise could be used to produce other goods and services, given the available technology. Additional units can be provided only by incurring an opportunity cost.

  Using the information above in the comparative 2010 and

a retailing firm changed from lifo to fifo in 2011. inventory valuations for the two methods appear below 112010 112011

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!

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