Question

On January 1, 2018, Water World issues $25.9 million of 6% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. Water World intends to use the funds to build the world’s largest water avalanche and the “tornado”— a giant outdoor vortex in which riders spin in progressively smaller and faster circles until they drop through a small tunnel at the bottom. 1-a. If the market rate is 5%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Do not round interest rate factors. Round "Market interest rate" to 1 decimal place. Enter your answers in dollars not in millions.) 1-b. The bonds will issue at A Discount A Premium Face amount 2-a. If the market rate is 6%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Do not round interest rate factors. Round "Market interest rate" to 1 decimal place. Enter your answers in dollars not in millions.) 2-b. The bonds will issue at A Premium Face amount A Discount 3-a. If the market rate is 7%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Do not round interest rate factors. Round "Market interest rate" to 1 decimal place. Enter your answers in dollars not in millions.) 3-b. The bonds will issue at Face amount A Premium A Discount

Answer #1

On January 1, 2018, Frontier World issues $39.1 million of 9%
bonds, due in 20 years, with interest payable semiannually on June
30 and December 31 each year. The proceeds will be used to build a
new ride that combines a roller coaster, a water ride, a dark
tunnel, and the great smell of outdoor barbeque, all in one
ride.
If the market rate is 8%, calculate the issue price. (FV of $1,
PV of $1, FVA of $1, and...

On January 1, 2021, Water World issues $25.9 million of 6%
bonds, due in 20 years, with interest payable semiannually on June
30 and December 31 each year. Water World intends to use the funds
to build the world’s largest water avalanche and the “tornado”— a
giant outdoor vortex in which riders spin in progressively smaller
and faster circles until they drop through a small tunnel at the
bottom.
1-a. If the market rate is 5%, calculate the issue
price....

On January 1, 2021, Frontier World issues $39.8 million of 8%
bonds, due in 15 years, with interest payable semiannually on June
30 and December 31 each year. The proceeds will be used to build a
new ride that combines a roller coaster, a water ride, a dark
tunnel, and the great smell of outdoor barbeque, all in one
ride.
2-a. If the market rate is 8%, calculate the
issue price. (FV of $1, PV of $1, FVA of $1,...

Christmas Anytime issues $730,000 of 6% bonds, due in 15 years,
with interest payable semiannually on June 30 and December 31 each
year.
Calculate the issue price of a bond and complete the first three
rows of an amortization schedule when:
Required:
1.
a) The market interest rate is 6% and the bonds issue at face
amount. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use
appropriate factor(s) from the tables provided. Do
not...

Christmas Anytime issues $710,000 of 5% bonds, due in 10 years,
with interest payable semiannually on June 30 and December 31 each
year.
Calculate the issue price of a bond and complete the first three
rows of an amortization schedule when:
1. The market interest rate is 5% and the bonds
issue at face amount. (FV of $1, PV of $1, FVA of $1, and PVA of
$1) (Use appropriate factor(s) from the tables
provided. Do not round interest rate...

On January 1, 2018, Water Wonderland issues $10 million of 9%
bonds, due in nine years, with interest payable semiannually on
June 30 and December 31 each year. Use Table 2 and Table 4.
1. If the market rate is 8%, will the bonds issue at face
amount, a discount, or a premium? Calculate the issue price. (Round
"PV Factor" to 5 decimal places. Round other intermediate
calculations and final answer to the nearest dollar amount. Enter
your answer in...

Ultimate Butter Popcorn issues 6%, 15-year bonds with a face
amount of $42,000. The market interest rate for bonds of similar
risk and maturity is 5%. Interest is paid semiannually.
At what price will the bonds issue? (FV of $1, PV of $1, FVA of
$1, and PVA of $1) (Use appropriate factor(s) from the
tables provided. Do not round interest rate factors. Round "Market
interest rate" to 1 decimal place.)

On January 1, 2018, Shirley Corporation purchased 10% bonds
dated January 1, 2018, with a face amount of $13 million. The bonds
mature in 2027 (10 years). For bonds of similar risk and maturity,
the market yield is 12%. Interest is paid semiannually on June 30
and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of
$1 and PVAD of $1) (Use appropriate factor(s) from the tables
provided.)
Required: Determine the price of...

On January 1, 2018, Shirley Corporation purchased 12% bonds
dated January 1, 2018, with a face amount of $24 million. The bonds
mature in 2027 (10 years). For bonds of similar risk and maturity,
the market yield is 16%. Interest is paid semiannually on June 30
and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of
$1 and PVAD of $1) (Use appropriate factor(s) from the tables
provided.) Required: Determine the price of...

A company issued 6%, 15-year bonds with a face amount of $67
million. The market yield for bonds of similar risk and maturity is
6%. Interest is paid semiannually. At what price did the bonds
sell? (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and
PVAD of $1) (Use appropriate factor(s) from the tables
provided. Enter your answers in whole dollars. Round final answers
to the nearest whole dollar.)

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