Question

16. Listed below are five terms followed by a list of phrases that describe or phrase...

16. Listed below are five terms followed by a list of phrases that describe or phrase with the best term placing the number designating

1. Bonds issued at face value
2. Bonds issued at a discount

3. Stated interest rate 4. Bonds issued at a premium
5. Market interest rate

The true interest rate used by investors to value a bond.

The stated interest rate is more than the market interest rate.

The stated interest rate equals the market interest rate.

The stated interest rate is less than the market interest rate.

The rate quoted in the bond contract used to calculate the cash payments for interest.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Listed below are five terms followed by a list of phrases that describe or characterize each...
Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the number for the most correct term 1. operating costs borne by the lessee 2. lessor reports rent revenue 3. viewed as an additional payment when guaranteed by the lessee 4. included with initial direct costs 5. viewed as an additional payment when reasonable certain choices for answers are - nonlease components, operating lease, purchase option, residual...
Listed below are ten terms followed by a list of descriptive phrases. a. financial position f....
Listed below are ten terms followed by a list of descriptive phrases. a. financial position f. operating capability b. equity g. assets c. net income h. acquisition cost d. liquidity i. control e. financial flexibility j. recognition ​ ____ 1. Process of recording and reporting an element in the financial statements ____ 2. Economic resource ____ 3. Ability of a company to use its financial resources to adapt to change ​ ____ 4. Economic resources, economic obligations, and their relationships  at...
Activation Exercise 12-1: Bonds Issued at a Discount Terms and Definitions The interest rate paid on...
Activation Exercise 12-1: Bonds Issued at a Discount Terms and Definitions The interest rate paid on the face amount of a bond is called the of interest. The interest rate paid on similar risk bonds is called the of interest. When the contract rate of interest is less than the market rate of interest, the bonds will sell for their face value. The difference between the selling price and the face amount of the bonds in this case is called...
1,The carrying value of a bond issued at a discount is its face value less the...
1,The carrying value of a bond issued at a discount is its face value less the unamortized portion of the discount?True or false? 2. What happens to the carrying value of bonds issued at a premium over the life of the bond issued ? a.decreases b.decreases c.stays the same 3.the issuance price on bonds sold at par value is a. less than the face value b. equal to the face value c. greater than the face value d. not determinable...
1. The stated rate of interest and the effective rate of interest are synonymous terms. This...
1. The stated rate of interest and the effective rate of interest are synonymous terms. This statement is A. True B. False 2. On January 1, Year 1 Residence Company issued bonds with a $50,000 face value. The bonds were issued at 96 offering a 4% discount. They had a 20 year term, a stated rate of interest of 7%, and an effective rate of interest of 7.389%.Assuming Residence uses the effective interest rate method, the carrying value of the...
ABC Company, a public company, decides to lease an office telephone for six months. The lease...
ABC Company, a public company, decides to lease an office telephone for six months. The lease transaction: Must be recorded as a leased asset and lease liability Must be recorded as a short-term lease May be recorded as a short-term lease Must be recorded at the fair market value of the leased asset When a corporation issuing bonds has the right to redeem ( buy back ) the bonds prior to maturity date at a stated dollar amount, what are...
Match the following bond terms by selecting the term that best describes each phrase. a. Principal...
Match the following bond terms by selecting the term that best describes each phrase. a. Principal is payable to the person who has possession of the bonds b. When the borrower must pay the principal amount to the lender c. Matures in instalments over a period of time d. Unsecured bond backed only by the good faith of the issuer e. Contract agreed to between the issuer of the bonds and the purchaser f. The contractual rate of interest that...
Diaz Company issued bonds with a $98,000 face value on January 1, Year 1. The bonds...
Diaz Company issued bonds with a $98,000 face value on January 1, Year 1. The bonds had a 6 percent stated rate of interest and a 10-year term. Interest is paid in cash annually, beginning December 31, Year 1. The bonds were issued at 97. The straight-line method is used for amortization. b. Determine the carrying value (face value less discount or plus premium) of the bond liability as of December 31, Year 1. c. Determine the amount of interest...
On January 1, Year 1, McTavish Incorporated issued bonds with a face value of $500,000, a...
On January 1, Year 1, McTavish Incorporated issued bonds with a face value of $500,000, a stated rate of interest of 8%, and a 5-year term to maturity. The effective rate of interest was 10%. Interest is payable in cash on June 30 and December 31 of each year. Which of the following statements is true? This bond was issued at a premium, and each semiannual cash payment is $25,000. This bond was issued at a discount, and each semiannual...
Kirby, Inc.'s newest bonds have a face value of $100,000 and a maturity ten years from...
Kirby, Inc.'s newest bonds have a face value of $100,000 and a maturity ten years from date of issue. If the bonds were issued at a premium, this indicates that Question 2 options: a) the effective rate of interest exceeded the stated rate. b) the market and nominal rates coincided. c) the stated rate of interest exceeded the market rate. d) no necessary relationship exists between the two rates. Under the effective-interest method of bond amortization, interest expense is equal...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT