Blue Corporation had the following 2017 income statement. Revenues $102,000 Expenses 65,000 $37,000 In 2017, Blue had the follow
ing activity in selected accounts. Accounts Receivable 1/1/17 22,000 Revenues 102,000 12/31/17 25,000 Write-offs 1,000 Collections 98,000 Allowance for Doubtful Accounts Write-offs 1,000 1/1/17 1,300 Bad debt expense 2,000 12/31/17 2,300 (a) Prepare Blue’s cash flows from operating activities section of the statement of cash flows using the direct method.
1 answer:
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Answer: $86,235
Explanation:
Use Excel or a financial calculator to calculate the bond price.
As the interest is payable semiannually, the relevant variables are:
Coupon = 10% * 100,000 * 1/2 years = $5,000
Yield = 12% / 2 = 6%
Number of periods = 15 years * 2 = 30 semi annual periods
Bond price = $86,235
