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Katen [24]
3 years ago
15

Again, Inc. bonds have a par value of $1,000, a 25 year maturity, and an annual coupon rate of 8.0% with annual coupon payments.

The bonds are currently selling for $868. The bonds may be called in 6 years for 108.0% of par. What quoted annual rate of return do you expect to earn if you buy the bonds and company calls them when possible?
a) 9.39%
b) 12.21%
c) 13.42%
d) 10.13%
e) 8.30%
Business
1 answer:
algol [13]3 years ago
8 0

Answer:

b) 12.21%

Explanation:

The computation of the quoted annual rate of return is shown below:

Given that

Future value = $1,000 × 108% = $1,080

Present value = $868

NPER = 6 years

PMT = $1,000 × 8% = $80

The formula is shown below:

= RATE(NPER;PMT;-PV;FV;TYPE)

The present value comes in negative

After applying the above formula, the annual rate of return is 12.21%

Therefore the correct option is b.

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The following are selected 2017 transactions of Sean Astin Corporation.
Vadim26 [7]

Answer and Explanation:

The Journal entries are shown below:-

A. a. Purchase Dr, $50,000

           To Accounts payable $50,000

(Being purchase of inventory is recorded)

b.Accounts payable Dr, $50,000

            To Notes payable $50,000

(Being issuance of notes is recorded)

c.Cash Dr, $50,000

  Discount on notes payable Dr, $4,000

             To Notes payable $54,000

(Being amount borrowed from bank and issued notes is recorded)

B. a. Interest expenses Dr, $1,000 ($50,000 × 8% × 3 ÷ 12)

            To Interest payable $1,000

(Being interest expenses is recorded)

b. Interest expenses Dr, $1,000 ($4,000 × 3 ÷ 12)

                 To Discount on notes payable $1,000

(Being interest expenses is recorded)

C. The Computation of interest-bearing note and the zero-interest-bearing note is shown below:-

Interest-bearing note = Note payable + Interest payable

= $50,000 + $1,000

= $51,000

Zero-interest-bearing note = Note payable - Discount

= $54,000 - ($4,000 - $1,000)

= $54,000 - $3,000

= $51,000

8 0
3 years ago
A business will usually choose to produce a new product inan existing facility if the cost is less that the cost of building a n
coldgirl [10]

Answer:

E) existing factory has enough capacity to handle demand for the new products as well as the existing products.

Explanation:

If the existing factory doesn't have enough capacity to produce both the new product and existing ones, then if doesn't matter if the technology used is the same, or the new product is an extension of an existing product line, or existing human resources possess the abilities and knowledge required, or even if the product design is already complete or not.

If the factory's production capacity cannot handle the new product, then the company needs to expand the existing factory's production capacity or build a new facility.

4 0
3 years ago
A subsidiary ledger:(A) used in place of the general ledger if the general ledger is destroyed or stolen.(B) a group of accounts
gayaneshka [121]

Answer:

The correct option is C

Explanation:

Subsidiary ledger are those kind of the ledger which is stated as the group of the similar or common accounts, whose combined balances are equal to the balance in the particular account of general ledger.

The general ledger is the account that summarizes or provide detailed information of the account balances of the subsidiary ledger is recognized as the control account or the master account.

The subsidiary ledger are those group of accounts which have a similar characteristic and provide summarized information regarding the control account.

3 0
3 years ago
Find the sum of 2x kg and 5x g. Give the answer in grammes.​
maksim [4K]

Answer: 3,600 g

Explanation:

7 0
2 years ago
Both competitive firms and monopolies produce at the level where marginal cost equals marginal revenue. ​Then, other things rema
maria [59]

Answer:

A. Competitive markets face perfectly elastic demand and marginal​ revenue, while monopolies face​ downward-sloping demand and marginal revenue.

Explanation:

In the case when competitive firms and monopolies generated at the level in which the marginal cost is equivalent to marginal revenue keeping the other things constant so the price should be less in the competitive market as compared to the monopoly because in the competitive markets it face perfectly elastic demand but in the monopoly it face the down ward sloping demand curve

Therefore the option a is correct

5 0
3 years ago
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