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STALIN [3.7K]
3 years ago
14

A company purchased $60,000 of 5% bonds on May 1 at par value. The bonds pay interest on March 1 and September 1. The amount of

interest accrued on December 31 (the company's year-end) would be:
Business
1 answer:
Readme [11.4K]3 years ago
4 0

Answer:

The interest accrued is $2,500.

Explanation:

The income accrued will arise after the date of purchase (May 1) of the bonds to the ending date of the accounting period (December 31). This duration is equal to 8 months.`

For the first four months (May 1 to September 1) the income accrued will be the income received semiannually for these four month:

Income Accrued = $60,000 * 6/12 * 5% = $1,500 Because the payment that will be received will be $1000 which belongs to 6 months starting from March 1 and ending at September 1.

And for the remainder 4 months (September 1 to December 31)

Income Accrued = $60,000 * 4/12 * 5% = $1,000

So the total income accrued for the year will be $2,500

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Ralph gives his daughter, angela, stock (basis of $8,000; fair market value of $6,000). no gift tax results. if angela subsequen
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Answer:

D) $2,000

Explanation:

Angela's basis on the stocks will be the same as her father's. Since she sold the stocks, her basis will be $8,000, so her recognized gains will = selling price - basis = $10,000 - $8,000 = $2,000

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4 years ago
Read 2 more answers
F 1What is the yield to maturity on a 10-year, 9% annual coupon, $1,000 par value bond that sells for $887.00? That sells for $1
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Answer:

When the bond is sale at premium, it means the market rate is lower than coupon rate. So investor purchase the bond a higher price until the bond yield equal the market rate

If sold at discount, the market rate is higher than coupon rate. This means it's sold below face value to increase the bond yield to market rate.

YTM if market price is 887 =  10.7366190%

YTM if market price is 1,134.2= 7.1764596%

Explanation:

For the YTM we can calculate an estimated using the following formula:

YTM = \frac{C + \frac{F-P}{n }}{\frac{F+P}{2}}

Where:

C= coupon payment 1,000 x 9% = 90

F= face value of the bonds = 1000

P= market price = 887

n= years to maturity = 10

YTM =  10.7366190%

YTM = \frac{C + \frac{F-P}{n }}{\frac{F+P}{2}}

C= 90

F= 1000

P= 1134.2

n= 10

YTM = 7.1764596%

A more precise answer can be achieve using excle or a financial calculator.

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Answer:

motivated

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to purchase the target, making him a (n) motivated consumer

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In team-based environments, the principal may have difficulty determining individual contributions by members. This can create a situation in which an opportunistic employee does little work but takes credit and this is known as adverse selection.

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