1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
AnnyKZ [126]
3 years ago
11

Wesimann Co. issued 15-year bonds a year ago at a coupon rate of 7.5 percent. The bonds make semiannual payments and have a par

value of $1,000. If the YTM on these bonds is 5.8 percent, what is the current bond price?
Business
1 answer:
brilliants [131]3 years ago
7 0

Answer:

$1,161.46

Explanation:

In order to determine the current bond price we can use an excel spreadsheet and the present value formula: =PV(Rate,Nper,PMT,FV)

where:

  • Nper = 14 x 2 = 28 (15 year bond issued 1 year ago = 14 years)
  • Rate = 5.8% / 2 = 2.9% (semiannual payments)
  • PMT = ($1,000 x 7.5%) / 2 = $37.50
  •  FV = $1,000 (face value of bonds)
  • PV = ?  

Current price =PV(Rate,Nper,PMT,FV) =PV(2.9%,28,37.50,1000) = $1,161.46

You might be interested in
Which of the following would you expect to decrease the demand for tennis racquets?
VladimirAG [237]

Answer:

C) An increase in the price of tennis racquets

Explanation:

If tennis racquets become more expensive, the demand for them will decline, and people will try to supply this need with substitutes, for example, lacrosse raquets. The reason for this is that the classical supply and demand model tells us that demand and price are inversely correlated: if the price goes up, demand goes down, and viceversa.

3 0
3 years ago
In Year 1, Lee Inc. billed its customers $62,000 for services performed. The company collected $51,000 of the amount billed. Lee
PIT_PIT [208]

Answer:

Lee Inc.

a. Amount of revenue Lee will report on the Year 1 income statement:

= $62,000

b. Amount of cash flow from revenue to report on the statement of cash flows:

= $51,000

c. The net income for the period:

= $23,000

d. The net cash flow from operating activities for the period:

= $20,000

e. The amount of net cash flow from investing activities:

= ($21,000)

f. The amount of net cash flow from financing activities:

= $40,000

f. Amounts of total assets, liabilities, and equity on the year-end balance sheet:

Total assets = $71,000

Total liabilities = $8,000

Total Equity = $63,000

Explanation:

a) Data and Calculations:

Service Revenue = $62,000

Cash collection from customers $51,000

Outstanding (Accounts Receivable) $11,000 ($62,000 - 51,000)

Operating expense on account = $39,000

Cash paid on account  31,000

Outstanding (Accounts Payable) $8,000

Common Stock $40,000

Land $21,000

b) Cash Account:

Cash collection from customers $51,000

Cash paid on account                   (31,000)

Common Stock                              40,000

Land                                              (21,000)

Cash balance                              $39,000

c) Income Statement:

Service Revenue   $62,000

Expenses                (39,000)

Net Income           $23,000

d) Assets:

Cash                         $39,000

Accounts Receivable   11,000

Land                            21,000

Total                          $71,000

e) Liabilities:

Accounts Payable      $8,000

Common Stock          40,000

Net Income                23,000

Total                          $71,000

f) Statement of Cash Flows:

Operating activities:

Cash collection from customers     $51,000

Cash paid to suppliers                      (31,000)

Net cash from operating activities $20,000

Investing activities:

Land                                                ($21,000)

Financing activities:

Common Stock                               $40,000

3 0
3 years ago
Mark the statements that are TRUE.
trasher [3.6K]

Answer:

true statements are

b

c

d

e

5 0
2 years ago
Read 2 more answers
Variable $100,000 $ 25,000 Fixed 150,000 75,000 Total $250,000 $100,000 What is the initial selling price needed to obtain a tar
hodyreva [135]

Answer: $8.00

Explanation:

Details missing in question are:

These costs are for 50,000 units.

$250,000 is manufacturing cost. $100,000 is administrative cost.

The total manufacturing cost is shown to be $250,000 above.

A profit of $50,000 is needed in addition to this cost as well as the administrative cost of $100,000.

Total revenue expected is therefore:

= 250,000 + 100,000 + 50,000

= $400,000

50,000 units are to be sold so to make a revenue of $400,000, each unit should be sold for:

= 400,000 / 50,000

= $8.00

8 0
3 years ago
When creative pen company designed a new, ergonomically-friendly pen, they wanted to, literally, get in the hands of as many con
34kurt
The answer to the given question is "INTENSIVE" distribution.

When creative pen company designed a new, ergonomically-friendly pen, they wanted to, literally, get in the hands of as many consumers as possible. The creative pen will likely choose an "INTENSIVE" distribution.
7 0
3 years ago
Other questions:
  • You are managing a portfolio of $1 million. Your target duration is 10 years, and you can choose from two bonds: a zero-coupon b
    9·1 answer
  • An entrepreneur conducted many experiments in a project without success. What characteristic must this person have to succeed?
    5·2 answers
  • A manufacturing company is thinking about building a new factory. The factory, if built, will yield the company $300 million in
    14·1 answer
  • Dunkin' Brands just paid an annual dividend of $1.10 a share. The firm expects to increase this dividend by 8 percent per year t
    7·1 answer
  • ___ is any direct to a consumer or business recipient that is designed to generate a response in the form of an order, a request
    6·2 answers
  • Russell’s is considering purchasing $388,000 of equipment for a four-year project. The equipment falls in the five-year MACRS cl
    9·1 answer
  • The sales forecasting method that consists of making a product available to buyers in one or more locations and measuring purcha
    12·1 answer
  • The forest resource of nepal is degading day by day .write the reasons​
    14·2 answers
  • Your hand:
    9·1 answer
  • what should you do if you do not have or do not believe that you have the proper materials to safely perform your job?
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!