Determine the Purchase Price of a Bond that is purchased on the Coupon Date.A $500 bond matures on March 1, 2026, interest is 6.7% payable semi-annually.Determine the purchase price of the bond on September 1, 2020, to yield 8.7% compounded semi-annually.Will this bond sell at a premium or at a discount? discounta.) Determine the value of the coupon.b.) Determine the number of coupons left on the bond.11c.) Determine the Present Value of the Bond.d.) Determine the Present Value of the Coupons.e.) What is the purchase price of the Bond on September 1, 2020?>

solution given Face value $500 Maturity date March 1,2026 Coupon rate 6.7%…

Answered: Determine the Purchase Price of a Bond…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Assume that a bond is issued with the following characteristics: Date of bonds: January 1, 2023; maturity date: Dec. 31, 2027; face value: $200,000; Coupon interest rate: 10 percent paid semiannually; market interest rate: 12 percent; issue price: $185,280; bond discount is amortized using the effective interest method of amortization. What is the amount of bond discount amortization for the June 30, 2023, adjusting entry? A) $559 B) $1,117 C) $10,000 D) $11,117
f. Now assume the date is October 25, 2019. Assume further that a 12%,10-year bond was issued on July 1, 2019, pays interest semiannually (onJanuary 1 and July 1), and sells for $1,100. Use your spreadsheet to findthe bond’s yield.
Give typing answer with explanation and conclusion 1- Imagine the bond above displayed the following details: $10,000 Matures: January 31, 2030; Interest of $200 payable June 30 and December 31 of each year. Can you calculate the annual effective interest rate for this bond? a)2% b)4% c)6% d)One cannot tell.
Required: Find the duration of a bond with settlement date May 29, 2018, and maturity date November 19, 2027. The coupon rate of the bond is 6%, and the bond pays coupons semiannually. The bond is selling at a yield to maturity of 7%. (Do not round intermediate calculations. Round your answers to 4 decimal places.) Macaulay duration Modified duration
A bond has following characteristics: it was issued on 14.06.2018 and has 10 years to maturity. Coupon is paid semi-annually and carries interest rate of 3,2%. Market interest rate is currently 2,9% for similar issues. Investor purchased the bond on 19.11.2021. a. Calculate MacDuration b. Calculate ModDuration c. When market interest rates increase by 50 basis points, calculate price effect using results obtained in question (b)
please solve step by step if using BA caluculater please explain what values use for what. if using excel show the formula A broker receives an order for three bonds: (a) 7% bond (pays interest on March and September 15) maturing on September 15, 2030; (b) 5.5% bond (pays interest on May and November 1) maturing on May 1, 2035; and (c) 10% bond (pays interest on January and July 8) maturing on July 8, 2025. All three bonds pay semi-annual interest and the current market interest rate is 9% (for all three). What prices would the broker quote for each of the three bonds if the sale is settled on May 4, 2022? (a) Show your work. (b) (c) How much accrued interest would the buyer need to pay on each of the bond? Show your work. How much would the buyer actually pay for each of the bond? Show your work.
A $11,000 bond with a coupon rate of 5.35% is redeemable on July 01, 2031. It is purchased on February 10, 2025 when the yield rate is 5.85% compounded semi- annually. Please include a well-labelled timeline diagram. a. What is the purchase price of the bond? Round to the nearest cent b. What is the amount of discount or premium on the bond?
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On Monday March 6, 2023 you purchase a $1,000 Treasury bond that matures on May15, 2031 (settlement occurs one day after purchase, so you receive actual ownership of the bond on Tuesday March 7th, 2023). The coupon rate on the Treasury-note is 4.00 percent. The last coupon payment occurred on November 15, 2022, and the next coupon payment will be paid on May 15, 2023. The price that your dealer quotes you is $978.38 Yields on similar bonds are currently 4.5% Calculate the dirty price of this bond.
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