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3 years ago

"Which bond recommendation would be the LEAST safe for an individual who seeks income that is free from federal income tax?"

Business

1 answer:

topjm [15]3 years ago

7 0

Answer:

A. AA-rated revenue bond that is escrowed to maturity

Explanation:

As first option is the bond that the issuer of bond called back prior to the matured. It occurs when there is a fall in the rate of interest

The second option is backup by a pledge that involves full trust and contains the secure option that enables an individual free from the federal income tax

The third option are issued by the authorities that are local and governed by the U.S government so it become secure that enables an individual free from the federal income tax

The fourth option is the mix of revenue bonds and the obligation bonds hat involves full trust and contains the secure option that enables an individual free from the federal income tax

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Addison company will issue a zero-coupon bond this coming month. The projected yield for the bond is 7%. If the par value of the

horsena [70]

Answer:

If the bond is zero coupon then there only be one lump sum payment at the end of the bond period and we will have to discount is back using the yield of the bond to find its present value or price. Because the convention is semi annual we will divide interest by 2 to find the semi annual interest rate and to number of periods we will multiply years by 2 because of semi annual convention.

Yield= 7/2= 3.5%

a. the maturity is 20 years

We have to discount 1,000 20 years back which means 40 periods back as 20*2= 40

1,000/1.035^40=252.5725

The present value of a zero coupon $1000 bond will be $252.5725 when the yield is 7% and maturity is 20 years.

b. the maturity is 30 years

We have to discount 1,000 30 years back which means 60 periods back as 30*2= 60

1000/1.035^60=126.93

The present value of a zero coupon $1000 bond will be 126.93 when the yield is 7% and maturity is 30 years.

c. the maturity is 50 years

We have to discount 1,000 50 years back which means 100 periods back as 50*2= 100

1000/1.035^100= 32.06

The present value of a zero coupon $1000 bond will be $32.06 when the yield is 7% and maturity is 50 years.

d. the maturity is 100 years

We have to discount 1,000 100 years back which means 200 periods back as 50*2= 200

1000/1.035^200= 1.02

The present value of a zero coupon $1000 bond will be $1.02 when the yield is 7% and maturity is 100 years.

Explanation:

3 0

3 years ago

Sales price $6.74 per unit

stiks02 [169]

Answer:

Margin of safety = 3190.922902 units rounded off to 3191 units

Explanation:

Margin of safety is the cushion or extra number of units that the business sells over the break even point in units. The break even point is the point where total revenue equals total cost and the business earns no profit or no loss. To calculate the margin of safety in units, we deduct the break even number of units from the budgeted number of units or sales.

Margin of safety = Budgeted units - Break even number of units

First we need to calculate the break even in units. The formula for break even in units is,

Break even in units = Fixed cost / (Selling price per unit - Variable cost per unit)

Break even in units = 9376 / (6.74 - 2.33)

Break even in units = 2126.077098 rounded off to 2126 units

Margin of safety = 5317 - 2126.077098

Margin of safety = 3190.922902 units rounded off to 3191 units

7 0

3 years ago

Sumner sold equipment that it uses in its business for $31,800. Sumner bought the equipment a few years ago for $79,100 and has

-Dominant- [34]

Answer:

Sumner's has a loss of $-7750 from the sale of the equipment

Explanation:

Solution

Given that:

We compute the amount of profit and loss, few steps will be taken which is given below:

Step 1: we compute the book value of the equipment which is shown below:

Book value = purchase price - depreciation claimed

= $79,100 -$39,550

= $39550

Therefore then book value is $39,550

Step 2: we calculate the amount of Sumner's gain or loss which is shown below:

The gain (loss) is = the value (sale) - book value

= $31,800 - 39550

= -7750

Therefore the loss from the sale of the equipment is -$7750

Which implies that Sumner's has a loss of $-7750

5 0

3 years ago

Are there any truly free dating websites

sergejj [24]

Honestly not really unless youre into match or something like that but match is basically just a app that most people use to find casual sex.

7 0

3 years ago

Dealing with the fact that certain aspects of any management situation are more important than others is called

luda_lava [24]

Answer:

Recognition of priorities

Explanation:

Management involves planning, organizing, controlling, supervising, a group of people which could be an entire team, workers or some fractions of workers in an environment to achieve organizational goals. An entrepreneur which is among the factors of production is indeed someone who manages, supervise the other factors of production, keeping an environment in which people work and achieve the goals of production.

Management is a profession and as such skill set to recognizing when some aspects of management becomes important than others and when some goals need to be given more attention to achieving the overall organizational goals can describe as Recognition of priorities.

Recognition of priorities brings some other important aspects of management into focus leaving out the less important ones cancelled or put on hold so as to save time and maximize labor efficiency.

3 0

3 years ago