Question

On June 30, 2018, Singleton Computers issued 8% stated rate
bonds with a face amount of $100 million. The bonds mature on June
30, 2033 (15 years). The market rate of interest for similar bond
issues was 6% (3.0% semiannual rate). Interest is paid semiannually
(4.0%) on June 30 and December 31, beginning on December 31, 2018.
(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:
1.** Determine the price of the bonds on June 30,
2018.

Answer #1

Bond characterstics | Amount | ||||||

1-a) | Principal | 100,000,000 | |||||

interest | 4,000,000 | ||||||

Market interest rate | 3% | ||||||

periods to maturity | 30 | ||||||

issue price | 119,600,760 | ||||||

Calculation of bond issue price | |||||||

Where | |||||||

i= | 3.00% | ||||||

t= | 30 | ||||||

principal | * | PV of $1 at 3% for 30 yrs = | |||||

100,000,000 | * | 0.41199 | = | 41199000 | |||

interest | * | PV of ordinary annuity at 3%= | |||||

4000000 | * | 19.60044 | = | 78401760 | |||

bond issue price | 119600760 | ||||||

1-b) | interest expense = 119600760*3%= | 3588023 |

5. On June 30, 2018, Singleton Computers issued 5% stated rate
bonds with a face amount of $320 million. The bonds mature on June
30, 2033 (15 years). The market rate of interest for similar bond
issues was 4% (2.0% semiannual rate). Interest is paid semiannually
(2.5%) on June 30 and December 31, beginning on December 31, 2018.
(FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of
$1) (Use appropriate factor(s)...

On June 30, 2021, Singleton Computers issued 6% stated rate
bonds with a face amount of $100 million. The bonds mature on June
30, 2036 (15 years). The market rate of interest for similar bond
issues was 5% (2.5% semiannual rate). Interest is paid semiannually
(3.0%) on June 30 and December 31, beginning on December 31, 2021.
(FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of
$1) (Use appropriate factor(s) from...

On September 30, 2018, the San Fillipo Corporation issued 8%
stated rate bonds with a face amount of $220 million. The bonds
mature on September 30, 2038 (20 years). The market rate of
interest for similar bonds was 10%. Interest is paid semiannually
on March 31 and September 30. ((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 December 31, 2018, Interlink Communications issued 6% stated
rate bonds with a face amount of $104 million. The bonds mature on
December 31, 2048. Interest is payable annually on each December
31, beginning in 2019. (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.) Determine the price of the bonds on December 31,
2018, assuming that the market rate of interest for...

When Patey Pontoons issued 10% bonds on January 1, 2018, with a
face amount of $560,000, the market yield for bonds of similar risk
and maturity was 11%. The bonds mature December 31, 2021 (4 years).
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.) Q.6 - What is the
interest expense for...

On December 31, 2021, Interlink Communications issued 6% stated
rate bonds with a face amount of $104 million. The bonds mature on
December 31, 2051. Interest is payable annually on each December
31, beginning in 2022. (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.)
Determine the price of the bonds on December 31, 2021, assuming
that the market rate of interest for...

On January 1, 2018, Shirley Corporation purchased 12% bonds
dated January 1, 2018, with a face amount of $19 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...

On January 1, 2018, Bishop Company issued 8% bonds dated January
1, 2018, with a face amount of $21.0 million. The bonds mature in
2027 (10 years). For bonds of similar risk and maturity, the market
yield is 10%. 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.
Round your intermediate calculations to...

On January 1, 2018, Bishop Company issued 8% bonds dated January
1, 2018, with a face amount of $20.8 million. The bonds mature in
2027 (10 years). For bonds of similar risk and maturity, the market
yield is 10%. 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. Round
your intermediate calculations to...

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...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 6 minutes ago

asked 9 minutes ago

asked 17 minutes ago

asked 19 minutes ago

asked 32 minutes ago

asked 58 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago