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Question - Mesa Ltd., a Canadian public company with a December 31 yearend, desired to raise cash to fund its expansion by issuing long-term bonds. The corporation hired an investment banker to manage the issue and also hired the services of a lawyer, an audit firm, etc. On May 1, 2019, Mesa sold $800,000 in long-term bonds. The bonds will mature in 10 years and have a stated interest rate of 5%. Mesa realized proceeds of $785,490 on the sale and incurred issue-related costs of $45,000. The bonds pay interest semi-annually on October 31 and April 30. The bonds are to be accounted for using the effective interest method.
On November 1, 2020 Mesa retired 50% of the bonds by repurchasing them in the public market. At that time the bonds were selling at par. Prepare all entries related to the bond transactions for the year ended December 31, 2019.
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: - Explain the goals and uses of special journals.
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.
Term Structure of Interest Rates
Write a report on Internal Controls
Prepare the bank reconciliation for company.
Create a cost-benefit analysis to evaluate the project
Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR
Distinguish between liquidity and profitability.
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, Compound interest, discount rate, force of interest, AV, PV
CAPM and Venture Capital
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