On July 1, 2023, DDJ Limited issued bonds with a face value of $900,000 due in 20 years, paying interest at a face rate of 11% on January 1 and July 1 each year. The bonds were issued to yield 12%. The company's year-end was September 30. The company used the effective interest method of amortization. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ORDINARY ANNUITY OF 1. (a) Using 1. factor Tables 2 a financial calculator, or 3 Excel function PV, calculate the premium or discount on the bonds Round factor values to 5 decimal places, eg 1.25124 and final answer to O decimal places, eg 5,275)

On July 1, 2023, DDJ Limited issued bonds with a face value of $900,000 due in 20 years, paying interest at a face rate of 11% on January 1 and July 1 each year. The bonds were issued to yield 12%. The company's year-end was September 30. The company used the effective interest method of amortization. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ORDINARY ANNUITY OF 1. (a) Using 1. factor Tables 2 a financial calculator, or 3 Excel function PV, calculate the premium or discount on the bonds Round factor values to 5 decimal places, eg 1.25124 and final answer to O decimal places, eg 5,275)

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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On January 1, 2025, Entity D issued $1,000,000 of 7%, 5-year bonds at 98. The bonds pay interest annually on December 31 and Entity D amortizes any premium or discount using the straight-line method. What is the annual interest expense on the bonds? $66,000. $74,000. $4,000. $70,000.
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June Company issued P4,000,000 of 8.5%, 5-year bonds on April 1, 2023. Interest payment dates are April 1 and October 1. With a 9% market rate of interest, the bonds were sold for P3,926,000. On November 1, 2026, P2,000,000 of the bonds were retired at face value plus accrued interest.How much gain or loss should June Company record upon retirement of these bonds? 8,808 loss 8,808 gain 9,499 loss 5,359 gain
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On January 1, 2020, Huber Co. sold 12% bonds with a face value of $2,000,000. The bonds mature in five years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $2,154,500 to yield 10%. Using the effective-interest method of amortization, interest expense for 2020 is: show steps please
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