All categories

2 years ago

Under what circumstances would a firm be more likely to buy the required number of bonds

1 answer:

3 0

It happens when a firm has a bond that would reach its maturity. It enters a "sinking fund" which is a way to pay it before it does. In this situation, it is required to have a number of bonds and catch up with the bond that is due to mature. Bonds in a sinking fund also offers lower interest rates for the firm and now makes the owner sell it to other investors. This way a firm can avoid financial problems in the future.

You might be interested in

What is a federal and/or state tax on specific goods like gasoline, tires, airfare, or cigarettes?

amm1812

An excise tax is a <span>federal and/or state tax on specific goods like gasoline, tires, airfare, or cigarettes. Excise taxes are most always included in the price of the product.</span>

8 0

2 years ago

Read 2 more answers

Craigmont uses the allowance method to account for uncollectible accounts. its year-end unadjusted trial balance shows accounts

marshall27 [118]

3 0

2 years ago

Which financial statements are required for proprietary funds?a) Statement of Net Position; Statement of Revenues, Expenses, and

Cerrena [4.2K]

Answer:

c) Statement of Net Position; Statement of revenues, expenditures, and changes in fund balances; Statement of Cash Flows

Explanation:

Proprietry funds are accounts that are part of governmental institutions and non profits organizations and these require a high standard of transparency and accountability, so they are require to provide to the government the next statements: tatement of net assets; a statement of revenues, expenses, and changes in fund net assets; and a statement of cash flows.

This is accordingly to the summary of statements N. 34 from the Governmental Accounting Standards Board.

3 0

2 years ago

What is the main difference between ballon mortgage and arm

LenKa [72]

Answer:

A balloon mortgage is a type of a loan that requires the borrower to make the payment as a lump-sum at the maturity period while under the ARM the borrower is allowed to choose the small periodic payments suitable for both the lender and the borrower.

ARM is the abbreviation for Adjustable Rate Mortgage. therefore the loan repayment changes according to agreement between the lender and the borrower.

4 0

2 years ago

Read 2 more answers

You wish to retire in 20 years, at which time you want to have accumulated enough money to receive an annual annuity of $24,000

den301095 [7]

Answer:

$3,286.52

Explanation:

Interest rate per annum = 12.00%

Number of years = 25

Number of compounding per per annum = 1

Interest rate per period (r) = 12.00%

Number of periods (n) = 25

Payment per period (P) = $24,000

PV of $24,000 payments after 20 years = P * [1 - (1/(1+r)^n)]/ r

PV of $24,000 payments after 20 years = 24000*[1-(1/(1+12%)^25]/12%

PV of $24,000 payments after 20 years = $188,235.34

Interest rate per annum = 10.00%

Number of years= 20

Number of payments per per annum = 1

Interest rate per period (r) = 10.00%

Number of periods (n) = 20

Future value of annuity (FVA) = $188,235

Annual contribution (P) = FVA/ ([ (1+r)^n - 1] / r)

Annual contribution (P) = 188235/(((1+10%)^20-1)/10%)

Annual contribution (P) = $3,286.52

5 0

2 years ago