Exercise 7-17 (Algo) Bonds payable-calculate market value LO 7-8 On August 1, 2014, Bonnie purchased $23,500 of Huber Company's 10%, 15-year bonds at face value. Huber Company has semiannual interest due on the bonds regularly. On August 1, 2022, market rates of interest had fallen to 8%, and Bonnie is considering selling the bonds. Use the present value tables (Table 6-4 and Table 6-5) Required: Calculate the market value of Bonnie's bonds on August 1, 2022. Note: Round your PV factors to 4 decimal places. Round your answer to 2 decimal places. Market value

Exercise 7-17 (Algo) Bonds payable-calculate market value LO 7-8 On August 1, 2014, Bonnie purchased $23,500 of Huber Company's 10%, 15-year bonds at face value. Huber Company has semiannual interest due on the bonds regularly. On August 1, 2022, market rates of interest had fallen to 8%, and Bonnie is considering selling the bonds. Use the present value tables (Table 6-4 and Table 6-5) Required: Calculate the market value of Bonnie's bonds on August 1, 2022. Note: Round your PV factors to 4 decimal places. Round your answer to 2 decimal places. Market value

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Problem 1: On January 1, 2022, Smith Corp. issued 5-year 12% bonds with face amount of P5,000,000 at a price of P4,497,320 which yields an effective rate of 15%. Interest is payable annually every December 31 starting December 31, 2022. Case 3: The bonds are retired at 92 plus accrued interest on September 30, 2024. 6. How much is the total amount of cash paid to retire the bonds on September 30, 2024? 7. How much is the gain or loss on early retirement of bonds on September 30, 2024? 8. How much is the interest expense for the year 2024?
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Question 1 Bonds (23 marks) Terra Company issued a $300,000, 7.50%, 10-year bond on June 1, 2015. Additional information on the bond follows: Bond Date: January 1, 2015 December 31, 2024 Maturity Date: Yield (Market) Rate: Interest Payment Date: Terra's year end: Required: Round calculations to the nearest dollar a) Calculate the present value of the bond assuming that it had been issued on January 1, 2015. Show calculations/keystrokes. (1 mark) 8% Interest is paid annually on December 31 of each year September 30 b) Prepare a bond amortization table from January 1, 2015 until December 31, 2018. Show each annual interest payment. (3 marks) c) Calculate the total amount of cash received by Terra on June 1, 2015, reflecting the fact the bond was issued on June 1, 2015. Make the journal entry to record the bond issue on June 1, 2015. (4 marks) d) Prepare the adjusting entry required at Terra's year end, Sept 30, 2017. (2 marks) e) Prepare the journal entry on Terra's books to make the…
View Policies On January 2, 2015, Monty Corporation issued $ 1,950,000 of 10% bonds at 98 due December 31, 2024. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method.") Current Attempt in Progress The bonds are callable at 101 (i.e., at 101% of face amount), and on January 2, 2020, Monty called $ 1,170,000 face amount of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Monty as a result of retiring the $ 1,170,000 of bonds in 2020. (Round answer to O decimal places, eg. 38,548.) Loss on redemption Prepare the journal entry to record the redemption. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented…
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j. Bonds Payable - Series 1 On January 1, 2015, Hazer issued $400,000 12% 10-year bonds. Interest is paid annually. The bonds were issued for investors to have a yield of 10%. Because of the high interest rate, Hazer decided to call the bonds on December 31, 2020 at 110. No entries were made in 2020 regarding this bond. The bondholders are entitled to receive the 2020 interest payment (prior to call). In the Excel spreadsheet, see the tab labelled "Bonds Payable - Series 1" to determine the carrying value, create the amortization schedule and perform any additional calculations. NOTE - the amount on the trial balance (Bonds Payable - Series 1) is your check number for the amortization schedule at December 31, 2020 - BEFORE ADJUSTMENTS and recording the 2020 interest payment. Present Value Calculation & Amortization Schedule PV Rate Nper Pymt FV Type
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Problem No. 4 On December 31, 2014, YEN Inc. issued a 3-year P4,500,000 serial bonds payable with 10% interest payable every December 31 starting in 2015. The P4,500,000 bonds is payable through equal annual installment every December 31. The effective interest rate of the bonds is 8%. 8. What is the initial measurement of the bonds payable on December 31, 2014? 9. What is the interest expense for the year ended December 31, 2015? 10. What is the carrying value of bonds payable on December 31, 2016?

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