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
german
3 years ago
5

Enviro Company issues 8%, 10-year bonds with a par value of $250,000 and semiannual interest payments. On the issue date, the an

nual market rate for these bonds is 10%, which implies a selling price of 87 ½. The straight-line method is used to allocate interest expense. 1. Using the implied selling price of 87 ½, what are the issuer's cash proceeds from issuance of these bonds? 2. What total amount of bond interest expense will be recognized over the life of these bonds? 3. What is the amount of bond interest expense recorded on the first interest payment date?
Business
1 answer:
vichka [17]3 years ago
5 0

Answer: 1. $218750 ; 2. $231, 250 ; 3. $11562.50

Explanation:

1. The bonds with a par value of $250,000 and implied selling price of 87 ½.

Cash proceed = 250,000 × 87.5%

= $218,750

2. Since it's semiannual interest payments, the total amount of bond interest expense that will be recognized over the life of these bonds will be:

[20 × (250,000 × 8% × 6/12)]+ $250,000 - $218,750

= $200,000 + $250,000 - $218,750

= $231, 250

3. The amount of bond interest expense recorded on the first interest payment date will be:

= Total bond interest expense/number of payments

= $231,250/20

= $11562.50

You might be interested in
On January 1, 20X8, Polo Corporation acquired 75 percent of Stallion Company's voting common stock for $300,000. At the time of
lions [1.4K]

Answer:

Explanation:

Base on the question been given to us, we can solve this using equity method as seen below

Investments in Polo = 300000+0.75*(40000-10000-5000*)

300000+0.75*(25000)

300000+18750

$318,750

Increase in value of Patent $50,000

Economic Life 10

Amortization $5,000

The $ 5000 would be reduced from the net income

6 0
3 years ago
Octavia has received an email from a customer asking her a question about a product unfortunately Octavia doesn't know the answe
Gwar [14]

Octavia should tell the customer that she doesn’t know the answer right now, but she will try to figure it out as soon as possible, and it may take a few days.

Another great option is for Octavia to ask a coworker right away who may know the answer to the question.

6 0
3 years ago
Read 2 more answers
I don’t understand this and need help
LuckyWell [14K]
I think tools, design, and materials
6 0
3 years ago
Tax planning Question 6 options: guides investment activities to maximize after-tax returns over the long term for an acceptable
krok68 [10]

Answer:

guides investment activities to maximize after-tax returns over the long term for an acceptable level of risk

Explanation:

Given that the purpose of Tax planning is to ensure that there is tax efficiency for the firm, in an after-tax evaluation, the goal of the firm in terms of returns or profits is toll achieved.

Hence, in this case, the correct answer to the question is that TAX PLANNING "guides investment activities to maximize after-tax returns over the long term for an acceptable level of risk."

8 0
3 years ago
What is cash flow when funding in a business?<br> ANSWER CORRECTLY NO LINKS!
Luda [366]

Answer:

reality income

Explanation:

aaaaaaaa

3 0
2 years ago
Read 2 more answers
Other questions:
  • Bowers looked to the American Political Dictionary to define ‘civil rights’, which are those "positive acts of government design
    6·1 answer
  • What is an example of a noncredible online source
    11·2 answers
  • Which of the following statements is true regarding the cumulative translation adjustment? Select one: Changes in the cumulative
    9·1 answer
  • You”ve decided that you want to get your household budget under control so you can increase the proportion of money you devote t
    8·2 answers
  • What does it mean when a part of the population is​ under-represented?
    14·1 answer
  • Joe regularly positions dies by hand into a machine press. he is beginning to experience cramps in his right hand. which action
    7·1 answer
  • _ are unique because the technology is based on the human brain and focuses on pattern recognition from large data sets. A. Lear
    8·1 answer
  • At contract maturity the value of a call option is ___________, where X equals the option's strike price and ST is the stock pri
    6·1 answer
  • Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $1,400,000 of 4-year,
    12·1 answer
  • True or false :Equifax experian and transunion are legally obligated to provide identical information
    8·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!