{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Ex 14-5 - Problem 14-5 9 Bond 80,000,000 Semi 4 years 10...

Info iconThis preview shows pages 1–8. Sign up to view the full content.

View Full Document Right Arrow Icon
Problem 14-5 9% Bond 80,000,000 Semi 4 years 10% Market Requirement 1: Amount PV Factors Interest 3,600,000 6.46 23,267,556 80,000,000 8 payments Principle 80,000,000 0.67684 54,147,200 4.50% 5% interest PV of Bonds 77,414,756 3,600,000 Requirement 2: Cash interest 4.5% 5% 77,414,756 3,600 6.46 23,268 1 3,600,000 3,870,738 270,738 77,685,494 80,000 0.67684 54,147 2 3,600,000 3,884,275 284,275 77,969,768 77,415 3 3,600,000 3,898,488 298,488 78,268,257 4 3,600,000 3,913,413 313,413 78,581,670 5 3,600,000 3,929,083 329,083 78,910,753 6 3,600,000 3,945,538 345,538 79,256,291 7 3,600,000 3,962,815 362,815 79,619,105 8 3,600,000 3,980,955 380,895 80,000,000 28,800,000 31,385,305 2,585,244 Cash interest 4.5% 5% 77,415 1 3,600 3,871 271 77,685 2 3,600 3,884 284 77,970 3 3,600 3,898 298 78,268 4 3,600 3,913 313 78,582 5 3,600 3,929 329 78,911 6 3,600 3,946 346 79,256 7 3,600 3,963 363 79,619 8 3,600 3,981 381 80,000 Effective Interest Increase in balance Outstanding Balance Effective Interest Increase in balance Outstanding Balance
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
28,800 31,385 2,585 Requirement 3: Account Debit Credit Issuer Cash 77,414,756 Discout on bonds payable 2,585,244 Bonds Payable 80,000,000 80,000 Investor Investment in bonds 80,000 Discount on bonds 2,585 Cash 77,415 Requirement 4: Date Account Debit Credit 7/31/2009 Interest Expense
Background image of page 2
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Background image of page 4
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Background image of page 6
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Background image of page 8
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}