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
mario62 [17]
2 years ago
7

A company issued 5-year, 7% bonds with a par value of $500,000. The market rate when the bonds were issued was 6.5%. The company

received $505,000 cash for the bonds. Using the straight-line method, the amount of recorded interest expense for the first semiannual interest period is:
Business
1 answer:
san4es73 [151]2 years ago
4 0

Answer:

The correct answer is $17,000.

Explanation:

According to the scenario, the given data are as follows:

Bonds percent = 7%

Par value of bonds = $500,000

Market rate = 6.5%

Cash received = $505,000

So, we can calculate the amount of recorded interest for semiannual interest period by using following formula:

First we calculate the premium on bonds,

So, Premium on bonds = Cash received - Par value of bonds

= $505,000 - $500,000

= $5,000

So, straight line amortization = Premium on bonds ÷ years

= $5,000 ÷ 5

= $1,000

So, Amount of interest expense for first semiannual is as follows:

Amount of interest = ( Par value of bonds × Bonds percent ) ÷ 2 - (straight line amortization ÷ 2)

= ( $500,000 × 7% ) ÷ 2 - ( $1,000 ÷ 2 )

=  $17,500 - $500

= $17,000.

You might be interested in
Suze says that YFB’rs are broke. She gives 10+ reasons why, what are 3 of the reasons of why they are broke?
zysi [14]

Suze named ten reasons why YFB’rs are broke. Below are three reasons she identified:

1)      The company  runs out of cash

2)      The company is overpromising and undelivering

3)      They invested much on products, thus having left with big inventory 

4 0
3 years ago
This monetary policy________the economy's demand for goods and services, leading to_________product prices. In the short run, th
madreJ [45]

Answer:

<u>Increases,.. higher... more.. low.. lower</u>

Explanation:

This monetary policy acts as economic stimulant by increasing the supply of money in the economy, with increased supply come an increase in the economy's demand for goods and services, leading to higher product prices.

Also, In the short run, this <em>positive change</em> in prices induces firms to produce more goods and services.

This, in turn, leads to<u> a low level of unemployment because companies increase their demand for more labour to meet their demand.</u>

In other words, the economy faces a trade-off between inflation and unemployment: Higher inflation leads to lower unemployment.

7 0
3 years ago
why did aig get bailed out while lehman brothers did not? group of answer choices it had a stronger balance sheet lehman brother
GarryVolchara [31]

Because all other big financial corporations would have failed due to the prospect of systemic risk, aig received bailout money while Lehman Brothers did not.

The process of raising money or capital for any form of spending is referred to as finance. It involves directing different sources of funding, such as credit, loans, and investment money, to the businesses that can use them most effectively. The definition of finances according to Finance Box is "The money that people, businesses, or national economies earn and spend." Risk is the potential for bad things to happen, to put it simply. Risk refers to uncertainty on how a certain action will affect or have implications for a human value (such as one's health, well-being, wealth, property, or the environment), frequently focused on unfavourable outcomes.

Learn more about Risk  here

brainly.com/question/17284407

#SPJ4

3 0
1 year ago
Why are foreign mnes like ups seeking to invest in india?
jarptica [38.1K]

The foreign MNC's like UPS seeking to invest in India because of the country's market potential, skilled workforce and political stability.

The foreign MNCs are investing in India because of cheaper production costs. India is a critical growth market for logistics giant United Parcels Service (UPS) as it aims to provide the predictable and reliable service to B2B domestic market through its new venture called MOVIN.

India's market potential, skilled workforce and political stability are the three key reasons that make India the favored destination for foreign investment. When compared to other countries India is a relatively cheaper place to conduct business.

Hence, these reasons attracts foreign investors towards India.

To learn more about MNC's here:

brainly.com/question/2846229

#SPJ4

4 0
1 year ago
Indicate how each of the following transactions affects U.S. exports, imports, and net exports.
Oxana [17]

Answer:

 export               import                net export  

1. increases         unchanged         increases

2. unchanged       increases             decreases

3.  unchanged       increases             decreases

4. unchanged       increases             decreases

5. increases         unchanged         increases

Explanation:

export would comprise of goods and services produced in the US that are been sold to foreign countries

Import would comprise of foreign produced goods and services that are been sold in the US

Net export would increase when export occurs and decrease when import occurs

Net export = exports – imports

When the French historian visits the US museum and the European family visits Disney,  they are enjoying US services, thus export increases and net export increases

The purchase of books from Cambridge in UK, Panasonic camera and the visit to Japan constitutes import. These increases import and reduces net export

7 0
2 years ago
Other questions:
  • Zing Inc. is a large fashion brand that manufactures clothing and shoes. The top managers of Zing have decided to use the profit
    11·1 answer
  • Eastman Kodak reported that the cost of its PPE on December 31, 2010 was $6,805 million. On January 1, 2010, it had been $7,327
    8·1 answer
  • Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one uni
    5·1 answer
  • Which loan type requires you to make loan payments while you’re attending school
    5·1 answer
  • Cool Taste Company purchased $1,500 of supplies with cash. What effect does this transaction have on the accounting equation?
    7·1 answer
  • Based on M&amp;M Proposition 2 with taxes, the weighted average cost of capital:
    6·1 answer
  • Which of the following goods best fit the characteristics of a private good?
    5·1 answer
  • A proximity sensor attached to the tip of an endoscope could reduce risks during eye surgery by alerting surgeons to the locatio
    8·1 answer
  • Penetration pricing doesn't work if ________.
    8·1 answer
  • Expenses and revenues that relate directly to the principal revenue-generating activities of the company are classified as _____
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!