Provide answers in the attached word document in 1 1/2 page. (providecalculation in excel please and any reference).

1) A company issued $2,000,000 of 30 year, 8% bonds on April 1 2005, with interest payable on April 1 and October 1. The fiscal year of the company is the calendar year. Journalize the entries to record the following selected transactions:

2005
Apr1. Issued the bonds for cash at their face amount
Oct1….

The 7 percent annual coupon bonds of TPO, Inc. are selling for $1,021. The bonds have a face value of $1,000 and mature in 6.5 years. What is the yield to maturity?

A. 6.42 percent

B. 6.59 percent

C. 6.63 percent

D. 6.68 percent

E. 6.70 percent

The Big Bird Corporation issued $600,000 of 7%, 10-year bonds for $559,224 on June 30, 2012. Interest is payable on December 31 and June 30. The bonds were sold to yield an effective interest rate of 8%. The company uses the effective interest method.

(a) Prepare an amortization schedule for the date…

A company issues $20,000.000. , 7.8%, 20 year bonds to yield 8% on January 1, 2006. Interest is paid on June 30 and December 31. The proceeds from the bonds are $19,604,145. Using straight line amortization, what is the carrying value of the bonds on December 31, 2008?

a) $19,670,231.
b) $19,940,622.
c…

Investor G. Loeb owns a 5-year, $1,000 bond with a 5% coupon. If the yield to maturity on similar bonds is currently 10%, what is Mr. Loeb’s bond worth today?

Type your question here

One year ago Clark Company issued a 8-year, 10% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of
$987, and it now sells for $986.22.

1. What is the bond’s nominal yield to maturity? Round your answer to two decimal places.

   What is the bond’s nominal yield to call? Round your answer to two decimal places.

   Would an investor be more likely to earn the YTM or the YTC?

   -Select-

   Since the YTC is above the YTM, the bond is likely to be called.

   Since the YTM is above the YTC, the bond is not likely to be called.

   Since the YTC is above the YTM, the bond is not likely to be called.

   Since the coupon rate on the bond has declined, the bond is not likely to be called.

   Since the YTM is above the YTC, the bond is likely to be called.

   Item 3

2. What is the current yield? (Hint: Refer to Footnote 7 for the definition of the current yield and to Table 7.1.) Round your answer to two decimal
   places.

   Is this yield affected by whether the bond is likely to be called?

   1. If the bond is called, the current yield and the capital gains yield will both be different.
   2. If the bond is called, the current yield and the capital gains yield will remain the same but the coupon rate will be different.
   3. If the bond is called, the current yield will remain the same but the capital gains yield will be different.
   4. If the bond is called, the current yield and the capital gains yield will remain the same.
   5. If the bond is called, the capital gains yield will remain the same but the current yield will be different.

   -Select-

   I

   II

   III

   IV

   V

   Item 5

3. What is the expected capital gains (or loss) yield for the coming year? Round your answer to two decimal places.

   Is this yield dependent on whether the bond is expected to be called?

   1. If the bond is expected to be called, the appropriate expected total return is the YTM.
   2. If the bond is not expected to be called, the appropriate expected total return is the YTC.
   3. If the bond is expected to be called, the appropriate expected total return will not change.
   4. The expected capital gains (or loss) yield for the coming year depends on whether or not the bond is expected to be called.
   5. The expected capital gains (or loss) yield for the coming year does not depend on whether or not the bond is expected to be called.

YOURCO needs to raise $45,000,000 by selling bonds {no internal equity will be generated} and YOURCO has a
target capital structure of: 65% common shares, 5% preferred shares, & 30% debt. Floatation costs for each are: 9% common, 6% preferred, 3% debt. What is
the true cost figure the company should use to evaluate the project?

Mitchell Enterprises has bonds on the market making annual payments, with 16 years to maturity, and selling for $957. At this price, the bonds yield 9.0
percent. Required: What must the coupon rate be on Mitchell’s bonds?

ABC Corp. issued a 12%, 20-year coupon rate bond 5 years ago. Interest rates are now 8%. Based on semi-annual analysis what is the current price of the bond?

On 6/1/05 Tocinto sold its 8 year $1000 face value, 9% bonds dated 6/1/05 at an effective annual interest rate of (yield) 10%. Interest is payable semiannually with the first payment due 9/1/05. Tocinto uses the effective interest method of amortization. Bonds issue costs were incurred. The bonds can be called at 101 after 6/1/06.

Company	Coupon	Maturity	LastPrice	LastYield	EST $ Vol(000’s)
Xenon, Inc. (XIC)	6.50	Jan 15, 2031	94.293	??	57,373
Kenny Corp. (KCC)	7.23	Jan 15, 2028	??	6.24	43,813
Williams Co. (WICO)	??	Jan 15, 2037	94.845	7.06	43,813

To calculate the number of years until…

You have a bond that pays $60 per year in coupon payments. Which of the following would result in an increase in the price of your bond? A. The price of a share of stock in the company falls. B. the likelihood that the firm issuing your bond will default on debt increases.

Two years ago, Maple Enterprises issued 6%, 20 years bonds and Temple Corp issued 6%, 10 year bonds. Since their time of issue, interest rates have increased. Which of the following statements is true of each firm’s bond prices in the market, assuming they have equal risk?

Question options:

1) Maple’s…

A $200,000, 8%, 20-year bond was issued at 97. The proceeds received
from the bond issuance are how much?

It is now January 1, 2012, and you are considering the purchase of an outstanding bond that was issued on January 1, 2010. It has a 8.5% annual coupon and had
a 15-year original maturity. (It matures on December 31, 2024.) There is 5 years of call protection (until December 31, 2014), after which time it can be
called at 109-that is, at 109% of par, or $1,090. Interest rates have declined since it was issued; and it is now selling at 111.545% of par, or $1,115.45.

1. What is the yield to maturity? Round your answer to two decimal places.
   %

   What is the yield to call? Round your answer to two decimal places.
   %

2. If you bought this bond, which return would you actually earn? Explain your reasoning.
   1. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM.
   2. Investors would expect the bonds to be called and to earn the YTC because the YTM is less than the YTC.
   3. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM.
   4. Investors would not expect the bonds to be called and to earn the YTM because the YTM is greater than the YTC.
   5. Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the YTC.

   -Select-

   I

   II

   III

   IV

   V

   Item 3

3. Suppose the bond had been selling at a discount rather than a premium. Would the yield to maturity have been the most likely return, or would the yield to
   call have been most likely?
   1. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM.
   2. Investors would not expect the bonds to be called and to earn the YTM because the YTM is greater than the YTC.
   3. Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the YTC.
   4. Investors would expect the bonds to be called and to earn the YTC because the YTM is less than the YTC.
   5. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM.

   -Select-

   I

   II

   III

   IV

   V

   Item 4

The bond’s indenture indicates that the call provision gives the firm the right to call them at the end of each year beginning in Year 5. In Year 5, they may be called at 109% of face value, but in each of the next 4 years the call percentage will decline by 1 percentage point. Thus, in Year 6 they may be called at 108% of face value, in Year 7 they may be called at 107% of face value, and so on. If the yield curve is horizontal and interest rates remain at their current level, when is the latest that investors might expect the firm to call the bonds?

Find the price for bond A, and the YTM for bond B.

Bond A:
Par Value = 100
Coupon = 7.34%
Maturity = 3 years
Compounding = semi-annual
YTM = 5.64%
Price = ?

Bond B:
Par Value = 100
Coupon = 4.5%
Maturity = 15 years
Compounding = semi-annual
YTM = ?
Price = $95.67

Jack Jones is interested in buying some bonds. The bonds have a 12% coupon rate and mature in 20 years. If the bonds have a par value of $1,000 and are currently selling for $1,160, what is the approximate yield to maturity on the bonds?

a) 12%
b) 11.6%
c) 8.3%
d) 10.22%

Can you please provide details as…

I’m in charge of an estate for a relative who just died. There is a $10,000 bond that I need to divide between the estate’s two 15-year old benefactors (me and my brother).
I say: “Why don’t you give the bond to my brother and have him pay me $5000. That will be fair.”
Explain why this may not be fair. In your answer explain to this 15 year old the present disounted value and why it applies here.

————–
I’ve read the chapter in the book, but I can’t seem to find a good anwer, Please help!

. A bond has $1,000 face value, 18 months to maturity, a 7% per year coupon (paid semi-annually), and is priced to yield 10% (APR, compounded semi-annually).
a. What is the value (PV) of the bond?
b. If the present value of the bond were $1,000 – what would be the yield (semi-annual compounding)…

Par Value=100
Coupon=8%
Maturity=7 years
Compounding=semi-annual
YTM=10%
Call provision=callable in 4 years at 115%

a) Given the details of the bond, please calculate its yield to call.
b) Who has the option and under what circumstances they are going to exercise it?
c) Would the yield of a non-callable bon…

What is the present value of a bond that has a par value of $1000 with a coupon rate of 6% and matures in 6 years? – the market required rate
of return is 4%. please show formula calculation

On January 1, 2011, Instaform, Inc., issued 10% bonds with a face amount of $50 million, dated January 1. The bonds mature in 2030 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid semiannually.

Required:

1.

Determine the price of the bonds at January 1, 2011,…

Bond Info:

Par Value=10

Coupon=6

Maturity=5

Compounding=Semi-annual

YTC=8

a) Please calculate the modified duration of the bond.

b) Following a), please calculate the bonds effective duration by using a move o…

The par value of a bond is $450. The redemption value is $425. The bond has nominal annual copoun rate of interest of 4.4% compouned quarterly. The yeild rate
is also a nominal annual rate compounded quarterly of 5.2%. The book value after the 5th coupon payment is $417.21. Find the price of the bond with quartely
payments.

A bond has the following characteristics.

Time to Maturity 12 years
Payment Frequency Annual
Par Value $1,000
Bond Price $1,323

A What is the bond’s yield to maturity?
B What is the bond’s current yield?
C In this same example, would you invest in a security that was about the same risk as the bond but had…

Wolford Company borrowed $750,000 from U.S. Bank on January 1, 2009 in order to expand its mining capabilities. The five-year note required annual payments of $195,327 and carried an annual interest rate of 9.5%. What is the amount of expense Wolford must recognize on its 2010 income statement?

A $46…

1. Consider the following four debt securities, which are identical in every characteristic except as noted:
W: A corporate bond rated AAA
X: A corporate bond rate BBB
Y: A corporate bond rated AAA with a shorter time to maturity than bonds W and X
Z: A corporate bond rated AAA with the same time to maturity as bond Y that trades in a more liquid market than bonds W, X, or Y.
List the bonds in the most likely order of the interest rates (yields to maturity) of the bonds from highest to lowest. Explain your work.
2. Explain how an economist could use the slope of the yield curve to analyze the probability that a recession will occur and why the spread may matter.
3. One year ago, you bought a bond for $10,000. You received interest of $400 at the end of the year, as well as your $10,000 principal. If the inflation rate over the last year was five percent, calculate the real return. Show your work.
4. Suppose that the price of a stock is $50 at the beginning of a year and $53 at the end of the year, and it pays a dividend of $2 during the year. Calculate the stock’s current yield, capital-gains yield, and the return. Show your work for three separate calculations.
5. Use the capital-asset pricing model to predict the returns next year of the following stocks, if you expect the return to holding stocks to be 12 percent on average, and the interest rate on three-month T-bills will be two percent. Calculate a stock with a beta of -0.3, 0.7, and 1.6. Show your work for three separate calculations.

Lycan, Inc., has 7.8 percent coupon bonds on the market that have 7 years left to maturity. The bonds make annual payments

A firm’s bonds have maturity of 10 years with a $1000 face value, an 8% semi-annual coupon, are callable in 5 years, at $1,050, and currently sells at a price of
$1,100. What is the yield to call (YTC)?

Assume Venture Healthcare sold bonds that have a ten-year maturity,a 12% coupon rate with annual payments, and a $1,000 par value.

Question:What would be the value of the bonds three years after issue in each scenario above, assuming that interest rates stayed at either 7% or 13%?

The above question t…

On January 1, 2011, NFB Visual Aids issued $800,000 of its 20-year, 8% bonds. The bonds were priced to yield 10%. Interest is payable semiannually on June 30 and
December 31. NFB Visual Aids records interest expense at the effective rate and elected the option to report these bonds at their fair value. On December 31, 2011,
the fair value of the bonds was $668,000 as determined by their market value in the over-the-counter market.

Required:

1Determine the price of the bonds at January 1, 2011, and prepare the journal entry to record their issuance.
2Prepare the journal entry to record interest on June 30, 2011 (the first interest payment).
3Prepare the journal entry to record interest on December 31, 2011 (the second interest payment).
4Prepare the journal entry to adjust the bonds to their fair value for presentation in the December 31, 2011, balance sheet.

Gomez Corporation issues 500, 10 year, 8% $1000 bonds dates jan 1 2010 at 96. The journal entry to record the issuance will show a :
A. credit to conds payable for 480000.
B.credut ti discount on bonds payable for 20000
C.debit to cash 480000
D.debit to cash of 500000

All of the following are factors tha…

Use the following corporate bond quotes to answer the question: To calculate the number of years until maturity, assume that it is currently January 15, 2010.

Company Ticker	Coupon	Maturity	Last Price	Last Yield	EST $ Vol (000’s)
Xenon, INC (XIC)	5.4	January 15, 2020	94.183	&nb…

The Victor Corporation issues 1,000, 10-year, 8%, $1,000 bonds dated January 1, 2009, at 96.

The journal entry to record the issuance will show a
a. credit to Bonds Payable for $960,000.
b. credit to Discount on Bonds Payable for $40,000.
c. debit to Cash for $960,000.
d. debit to Cash of $1,000,000.

(A) In the actual O3 molecule the best description of the number of bonds between O-O atoms is____ bonds.

(B) In the actual CO2 molecule the best description of the number of bonds between C-O atoms is_____ bonds.

(C) In the actual HCO2- ion the best description of the number of bonds between C-O …

a. Assume that Carson has two choices to satisfy
the increased demand for its products. It could
increase production by 10 percent with its existing
facilities by obtaining short-term financing to cover
the extra production expense and then using a por-
tion of the revenue received to finance this level of
production in the future. Alternatively, it could issue
bonds and use the proceeds to buy a larger facility
that would allow for 50 percent more capacity.
Which alternative should Carson select? b. Carson currently has a large amount of debt, and its
assets have already been pledged to back up its existing
debt. It does not have additional collateral. At this time,
the credit risk premium it would pay is similar in the
short-term and long-term debt markets. Does this imply
that the cost of financing is the same in both markets?
c. Should Carson consider using a call provision if it
issues bonds? Why? Why might Carson decide not to
include a call provision on the bonds?
d. If Carson issues bonds, it would be a relatively small
bond offering. Should Carson consider a private
placement of bonds? What type of investor might be
interested in participating in a private placement? Do you
think Carson could offer the same yield on a private
placement as it could on a public placement? Explain.
e. Financial institutions such as insurance companies
and pension funds commonly purchase bonds. Explain
the flow of funds that runs through these financial
institutions and ultimately reaches corporations that
issue bonds such as Carson Company.

Marks: 17 An investor, Carol, wants to buy a $2,000 face value bond now, which is two years after its issue date. She intends to keep it until its maturity date, which is 18 years from now. This bond has a coupon rate of 3% annually, with a single coupon payment once each year. The second coupon has…

Blue mountain Power Company obtained authorization to issue 20 year bonds with a face value of $10 million. The bonds are dated May 1, 2011 and have a contract
rate of interest of 10%. They pay interest on November 1 and May 1. The bonds were issued on August 1,2011, at 100 plus three months’ accrued interest.

Prepare the necessary journal entries in general journal form on:

a. August 1,2011, to record the issuance of the bonds

b. November 1, 2011, to record the first semiannual interest payment on the bond issued

c. December 31,2011, to record interest expense accrued through year end. (Round to the nearest dollar)

d. May 1,2012, to record the second semiannual interest payment (Round to the nearest dollar)

e. What was the prevailing market rate of interest on the date that the bonds were issued? Explain.

A bond with a face value of $1,000 matures in 12 years and has a 9 percent semiannual coupon. (That is, the bond pays a $45 coupon every six months). The bond currently has a nominal annual yield to maturity of 7.5 percent, and it can be called in 4 years at a call price of $1,045. How much should y…

Grohl Co. issued 11-year bonds a year ago at a coupon rate of 11.8 percent. The bonds make semiannual payments. If the YTM on these bonds is 6.8 percent, the current bond price is $

On January 1, 2004, St. Street Corporation issued $100,000 of ten-year bonds that pay 8% annually on December 31. At the time of issue, the bonds’ investors were demanding only a 7% return on their investment, and the cash proceeds of the bond issue to the corporation were $106,992. If St. Street us…