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wel
3 years ago
5

XYZ Corporation 10-year bonds paid its annual coupon of $110 yesterday. There are seven (7) annual coupons remaining. The bond h

as a par value of $1,000. If similar bonds offer a rate of return of 7 percent, how much should these XYZ bonds sell for in the bond market?
Business
1 answer:
Brums [2.3K]3 years ago
4 0

Answer:

Price of the bond is $1,215.57

Explanation:

Price of the bond is actually the present value of all cash flows of the bond.  Price of the bond is calculated by following formula:

Price of the Bond = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F / ( 1 + r )^n ]

Price of the Bond = $110 x [ ( 1 - ( 1 + 7% )^-7 ) / 7% ] + [ $1,000 / ( 1 + 7% )^7 ]

Price of the Bond = $592.82 + $622.75

Price of the Bond = $1,215.57

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2 years ago
Suppose the United States has two​ utilities, Commonweath Utilities and Consolidated Electric. Both produce 20 million tons of s
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Answer:

The incomplete part of the question is "Using a cap-and-trade system of tradable emission allowances will eliminate half of the sulfur dioxide pollution at a cost of $1 million per year. If the permits are not tradable, what will be the cost of eliminating half of the pollution? If permits cannot be traded, then the cost of the pollution reduction will be $1 million per year." The full question is attched as picture as well

1) Tradable permit system

Then lower MAC firm will abate the all pollution units

Then as MAC1 = $250, MAC2 = $275

Firm 1 = Consolidated electric

Firm 2 = Commonwealth utility

Then 1 will sell all permits to 2, at a price between $250 & $275.

So total cost of abatement of 20 units = MAC1 * 20

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= $5,000

2) Non-tradable permits

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7 0
3 years ago
Krol Corporation distributed marketable securities in redemption of its stock in a complete liquidation. On the date of distribu
Varvara68 [4.7K]

Answer:

The answer is 50.000 dollars

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When a corporation completely liquidates, the corporation wil recognize a gain or loss as if the property were sold at fair market value.

Amount realizes as if sold $150,000

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8 0
3 years ago
The budget director of Heather’s Florist has prepared the following sales budget. The company had $290,000 in accounts receiva
Elodia [21]

Answer:

Explanation:

1) Schedule of cash receipts:

Since 100% of account receivable is collected in the month following the month of sale, which means $290,000 will be collected in July.

2)  If there are no sales in September, amount of accounts receivable the company will report on its 3rd quarter balance sheet will be 0. Otherwise, the ending accounts receivable at the end of 3rd quarter will be = sales amount in September.

8 0
3 years ago
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Answer:

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Manufacturing cycle time is best defined as the "time from raw materials receipt to finished product exit."

To explain better, manufacturing cycle time is the overall time of process that covers the total duration it takes the final production of commodities to be made. That is beginning from the inception stage which is usually raw materials through its conversion stage and eventually into finished goods.

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3 years ago
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