Reference no: EM131427430
Treadway Company issued bonds with a face value of $20,000 on January 1, 2011. The bonds were due to mature in five years and had a stated annual interest rate of 8 percent. The bonds were issued at face value. Interest is paid semiannually.
a. As of December 31, 2011, market interest rates had decreased by 2 percent, and the market price of Treadway bonds reflected the entire change. Compute the present value of Treadway's bond liability as of that date, using the new effective interest rate (6 percent), and determine the economic gain or loss experienced by the company.
b. Assume instead that as of December 31, 2011, market interest rates had increased by 2 percent, and the market price of Treadway's bonds reflected the entire change. Compute the present value of Treadway's bond liability as of that date, using the new effective interest rate (10 percent), and determine the economic gain or loss experienced by the company.
c. What is the intuition underlying such gains and losses, and why are they not reflected on the financial statements? If you were analyzing the financial statements of Treadway, what could you do to improve the reported numbers?
Problem regarding the it policy and strategy
: Please read the article Value Disciplines that explains how companies create value for their customers. After reading the article, identify a company that is focused on either:
|
Reduces the chance of bias in a performance evaluation
: Since you are new as a Human Resource Manager, and the Claims Supervisor is a new position, you need to have a plan for a performance management system of the position. You are aware, from the job description, that it will require performance meas..
|
Compute the present value of the bond’s remaining cash flows
: Compute the present value of the bond's remaining cash flows as of December 31, 2012, using the effective rate at the time the bonds were issued. Explain the relationship between the balance sheet value of the liability and the present value of th..
|
Critical fundamental skills from the it professions
: Resources: "Presentation Fundamentals" with Tatiana Kolovou on Lynda.com, Instructions for Completing a Video Technology managers look for three critical fundamental skills from the IT professions hired today:
|
What is the intuition underlying such gains and losses
: Treadway Company issued bonds with a face value of $20,000 on January 1, 2011. The bonds were due to mature in five years and had a stated annual interest rate of 8 percent. The bonds were issued at face value. Interest is paid semiannually.
|
Analyze the major functions of the articular-nervous system
: The articular is the connection between two bones. There are many functions the joints have but one of the main functions would be movement. The joints also help bear our body's weight as well as give us stability. The joints contain synovial flui..
|
Finalize your business plan for new hwe accessories website
: Finalize your business plan for the new HWE Accessories website. Incorporate your instructor's feedback into a well-integrated, cohesive 5- to 10-page document using Microsoft Word including segments from Weeks Two, Three, Four, and Five.
|
Prepare the journal entry to record the redemption
: Assume that the bonds were issued in 2009 for 102, and at the time of redemption they had a balance sheet value of $507,000. Prepare the journal entry to record the bond redemption.
|
How would the computer represent the integer
: 1. Questions 1a through 1c are about a computer that represents integers in 16-bit, two's complement form. a. How would the computer represent the integer 7734? Your answer must be a binary (base 2) number, without a sign.
|