Bond Problems - BOND PROBLEMS 1. Bonds with a face value of...

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BOND PROBLEMS 1. Bonds with a face value of $150,000,000, coupon rate of 10% and a market rate of 8% that mature in 10 years. The bonds are issued July 1, 2005. What are the journal entries as of 7/1/2005 and December 31, 2005? N=20 I/YR=4% Pmt=150,000,000*10%/2=7,500,000 FV=150,000,000 PV=170,385,490 Date Interest Payment Premium Amo rt Carrying Value 07/01/05 $170,385,490 12/31/05 6,815,420 7,500,000 684,580 169,700,909 07/01/05 Cash 170,385,490 Premium on Bonds Payable 20,385,490 Bonds Payable 150,000,000 12/31/05 Interest Expense 6,815,420 Premium Amortization 684,580 Cash 7,500,000 2. Bonds with a face value of $20,000,000 that mature in 20 years. The required rate of return for these bonds is 5%, while the coupon rate is 4%. The bonds are issued September 1, 2005. What are the journal entries as of September 1, 2005, December 31, 2005 and December 31, 2006? N=40 I/YR=2.5% Pmt=20,000,000*4%/2=400,000 FV=20,000,000 PV=$17,489,722 Date Interest Payment Discount Amo rt Carrying Value
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Bond Problems - BOND PROBLEMS 1. Bonds with a face value of...

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