Reference no: EM132926907
Question - On July 1, 2015, ABC Co. issued 10-year, $4,574 million maturity value, 3% coupon bonds when the market rate was 2% for a cash price of $4,994 million. Interest was payable semi-annually on Dec. 31 and June 30. ABC also issued $3,527 million face value, 20-year, zero coupon bonds on July 1, 2017 that mature June 30, 2037 for a cash price of $2,619 million. The effective market interest rate at issuance was 1.5%. ABC repurchased $1,143 million face value coupon bonds on June 30, 2020 for $1,220 million cash (after interest was paid) and $582 million in face value of the zero- coupon bonds on June 30, 2021 for a purchase price of $432 million cash. Review what you have learned about coupon bonds as well as the explanation of zero-coupon bonds on p. 537 of your text, and answer the following questions, expressing all numbers in millions (for example, the face amounts of the bonds are $4,574 and $3,527, respectively). Please answer in complete sentences and show your calculations for numerical answers and journal entries. Please do not use decimals in any of your answers (Round to millions).
Required - Prepare the journal entries to record the repurchase of some of the debt in 2020 and 2021. [Repurchasing some of the bonds before the maturity date is called "early extinguishment" of the debt. The company makes a payment to the bondholders, who relinquish the bonds and their right to collect the face value at maturity, and the debt is removed from the books. To record the early extinguishment, the company makes a journal entry to remove the appropriate book value and decrease cash by the amount paid to the bondholders. If those two amounts are not equal, a gain or loss is recorded to balance the journal entry.
Illustrate potential problems for recruiting
: Illustrate potential problems for recruiting, selecting and then developing talented candidates from Generation Z for global organisations in the light of recen
|
Did anything instantly come to mind
: Did anything instantly come to mind that could affect your potential for a lasting loving relationship (such as your parents have been married several years?
|
Impacting human resource management
: Are the health care staffing trends/shortages in the market where you live consistent with national trends?
|
What will the total cost of this purchase be
: Michelle uses a credit card with a 23.24 APR compounded monthly to pay for car repairs totaling $790.59. What will the total cost of this purchase be
|
Prepare the journal entries to record the repurchase
: ABC also issued $3,527 million face value, 20-year, zero coupon bonds on July 1, 2017. Prepare the journal entries to record the repurchase
|
Create a corporate competitive intelligence system
: Reflective Article Review - How to Create a Corporate Competitive Intelligence System - Gaining competitive intelligencefrom social media data evidence
|
Describe demographics characteristics of priority population
: Describe the demographics characteristics of the priority population (e.g., numbers/percentages for age, gender, race/ethnicity, socioeconomic status)
|
What are considered to be ethical business behaviors
: Identify what you think are the top three behaviors in what you would adopt as "your" code of ethics as it pertains to project management.
|
Compute net operating profit after tax
: Question - Compute net operating profit after tax (NOPAT) for 2016, assuming a federal and state statutory tax rate of 37%
|