User Account

All Pages

What is the sales price for this bond

Assignment Help Accounting Basics
Reference no: EM132846332

Question - On January 1, Year One, Big Company offers to sell a $100,000 bond coming due in exactly 10 years. This bond pays cash interest of 2 percent at the end of each year. A buyer is found who wants to earn 5 percent interest each year. After some negotiation, Big agrees to the 5 percent effective rate. The present value of a single amount of $1 in ten years at 2 percent annual interest is .80 whereas the present value of a single amount of $1 in ten years at 5 percent annual interest is .63. The present value of an annuity of $1 in ten years at 2 percent annual interest is 8.75 whereas the present value of an annuity of $1 in ten years at 5 percent annual interest is 7.70. What is the sales price for this bond?

Reference no: EM132846332

Questions Cloud

What should the company report as additional paid-in capital : A company issues 10,000 shares of $10 par value common stock for $23 in cash per share. What should the company report as additional paid-in capital
Prepare the bank account of berol limited in general ledger : Berol Limited has a fixed deposit of R400, 00 at the bank. Prepare the bank account of Berol Limited in the general ledger
Determine company performs better with or without a bonus : Imagine you are interested in determining whether an employee of a company performs better with or without a bonus. What are some issues that could affect
What are the personal or communal ethical factors : What are the personal and/or communal ethical factors that may be involved in determining the moral position of either side given a contemporary debate,
What is the sales price for this bond : On January 1, Year One, Big Company offers to sell a $100,000 bond coming due in exactly 10 years. What is the sales price for this bond
Evaluate the implication of policies in the lives of clients : Demonstrate critical thinking skills that can be used to inform policymakers and influence policies that impact clients/constituents and services.
What is the current value of the company : Suppose that your all-equity firm wants to raise $12M in equity to finance a new project. What is the current value of the company
How might medication management errors in accomplishing task : How might medication management errors or slowness in accomplishing tasks with age-related vision loss might be mistaken as evident for other problems
What amount should be reported as gain on sale of bonds : During the period that the entity held this investment, amortization of the discount amounted to P20,000. What amount should be reported as gain on sale of bond

Reviews

Write a Review

Accounting Basics Questions & Answers

  Record the journal entries for the transactions

Jan. 11 Issued 21,550 shares of common stock at $16 per share. Record the journal entries for the transactions listed above

  Elaine provides more than half of the support for her son

elaine provides more than half of the support for her son james who does not live with her. james is 26 and is a

  To sell a piece of raw land in alaska

Keith Vaughn is trying to sell a piece of raw land in Alaska. Yesterday, he received two offers. Sally Youngblood offered Keith $10,000 in cash, payable on signing the deed. Billy Budd offered him $11,424, payable one year after signing the deed.

  Compute how much should be recorded as building

DEF Company bought a piece of land, Compute how much should be recorded as Land? Compute how much should be recorded as Building?

  What is the share of pedro from the income

The partnership earned profit of P105,000 during the year. What is the share of Pedro from the income of the partnership earned during the year

  What are the differences between the lifo and fifo methods

It is the controller's belief that the switch in inventory methods would increase the net income of the company. What are the differences between the LIFO and FIFO methods?

  Now that the board members of felicia amp fred are planning

now that the board members of felicia amp fred are planning to implement a new crystal jewelry product line they are

  Determine the amount of the variances for the above costs

sweeney companys 2014 responsibility accounting report includes the followingper unit variable

  Cd new is a direct marketer of popular music the following

cd new is a direct marketer of popular music. the following information about its revenue and cost structure is

  How to resolve ethical problems

Decision making framework - how to resolve ethical problems and what are the professional, organisational and personal ethics issues?

  Calculate the accounts receivable turnover

Calculate the accounts receivable turnover and the average collection period for 2017 for FedEx. Evaluate the balance in FedEx's allowance for doubtful accounts

  Following is information from jesper company

Following is information from Jesper Company for its initial month of business.

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