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Nimfa-mama [501]
4 years ago
5

On January 1, 2018, Debtor Corporation issued $2,000,000 of 20-year, 8% bonds at 96, when the market rate of interest was 8.5%.

The bonds pay interest annually on December 31. The company uses the effective interest method of amortization. How much cash will bondholders receive on December 31, 2018, the first interest payment date?
Business
1 answer:
Gnom [1K]4 years ago
4 0

Answer:

The bonholders will receive 160,000 in cash on December 31th, 2018

Explanation:

The cash proceeds will be the same regardless of the method of amortization

Face Value x interest rate = cuopon payment

2,000,000 x         8%         =        160,000

The bonholders will receive 160,000 in cash on December 31th, 2018

The market rate will be use to calculate the amortization on the bond.

<u>For the cuopon payment ,we will always use the bond interest rate and the face value.</u>

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In 1626, Dutchman Peter Minuit purchased Manhattan Island from a local Native American tribe. Historians estimate that the price
VLD [36.1K]

Answer:

<em>Approximately $22 billion</em>

Explanation:

<u>Future Value (FV)</u>

Given a present value (PV) of an investment, the annual interest rate r, the future value at time t years is given by

FV=PV\left(1+r)^t

Care must be taken to properly express the time in years and the rate in yearly pertentage.

The estimated value of the Manhattan Island in 1626 was PV=$24. 386 years later, at a r=5.5% its value would be

FV=\$24\left(1+0.055)^{386}=\$22,680,919,665

The present value can be estimated in more than $22 billion

7 0
4 years ago
You are considering a stock investment in one of two firms (LotsofDebt, Inc. and LotsofEquity, Inc.), both of which operate in t
Anuta_ua [19.1K]

Answer:

Debt ratio

94.16%

5.84%

Equity multiplier

17.13%

1.06%

Explanation:

The debt ratio can be calculated as follows

Lots of debt incorporation= total liability/total assets.

= 32.25/34.25

= 0.9416×100

= 94.16%

Lots of equity incorporation= 2.00/34.25

= 0.05839 × 100

= 5.84%

The eqiuty multiplier can be calculated as follows

Lots of debt incorporation= equity/multiplier

= 34.25/2.00

= 17.13%

Lots of equity incorporation= equity/multiplier

= 34.25/32.25

= 1.06%

5 0
3 years ago
Which of the following statements is CORRECT?
musickatia [10]

Answer:

C) One of the disadvantages of a sole proprietorship is that the proprietor is exposed to unlimited liability.

Explanation:

There is no avoidance to double taxation under corporate form, as company's pays tax on net income earned, and then if there is any distribution of income to shareholders, the shareholders are charged individually.

There is no such ease in transfer of share whether in corporate form or partnership form.

There is an indefinite liability in case of insolvency of sole proprietorship on the sole proprietor, as he is the only person in ownership of such shares.

No, voting rights in a corporate form are dependent on number of shares held.

Therefore, the correct statement is:

C) One of the disadvantages of a sole proprietorship is that the proprietor is exposed to unlimited liability.

6 0
4 years ago
Alan, 46, and Donna, 33, are filing a joint return for 2019. Neither is blind, and neither can be claimed as a dependent. They d
maksim [4K]

Answer:

$24,400

Explanation:

Assuming that Alan and Donna are married and they decide to file their taxes together, the standard deduction for 2019 taxes was $24,400.

The standard deduction increases if you or your spouse is over 65 years old, or if any of you is blind. The standard deduction generally increases a little bit every year, e.g. during 2018 it was $24,000 and for 2020 it is $24,800.

8 0
3 years ago
A particular​ country's exports of goods are increasing exponentially. The value of the​ exports, t years after 2007​, can be ap
Olegator [25]

Answer:

V(t) = $ 1.5 billion for 2007

V(t) = $1.5 billion, 295 million. For 2012

Doubling time = t = 177.69 yrs

Explanation:

a).

V(t) = 1.5e^(0.039t)

For the first year 2007, t= 0

V(t) = 1.5e^(0.039*0)

V(t). = 1.5e^0

V(t) =. 1.5*1 = 1.5

V(t) = $ 1.5 billion for 2007

For 2012 that is 5 years after,t= 5

V(t) = 1.5e^(0.0039*5)

V(t) = 1.5e^ (0.0195)

V(t) = 1.5(1.019691367)

V(t) = 1.5295

V(t) = $1.5 billion, 295 million.

b). Doubling time is when the value of the export is 1.5 *2 =$ 3 billion

3 = 1.5e^(0.0039t)

3/1.5= e^(0.0039t)

2 = e^0.0039t

In 2 = 0.0039t

0.693= 0.0039t

t = 177.69 yrs

7 0
3 years ago
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