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
Vinvika [58]
2 years ago
11

Downing Company issues $4,000,000, 8%, 5-year bonds dated January 1, 2020 on January 1, 2020 (ten periods). The bonds pay intere

st semiannually on June 30 and December 31. The bonds are issued to yield 5%. What are the proceeds from the bond issue?
Business
1 answer:
zlopas [31]2 years ago
4 0

Answer:

$4,525,123.84

Explanation:

The computation of the proceeds from the issuance of the bond is shown below:

Given that

Face Value of Bonds = $4,000,000

Annual Coupon Rate = 8%

So, Semiannual Coupon Rate = 4%

So, Semiannual Coupon = 4% × $4,000,000

= $160,000

Time to Maturity = 5 years

So, Semiannual Period = 10

And,

Annual Interest Rate = 5%

So, Semiannual Interest Rate = 2.5%

Now the proceeds from the issuance of the bond is

= $160,0000 × PVIFA(2.5%, 10) + $4,000,000 × PVIF(2.5%, 10)

= $160,000 × 8.752064  + $4,000,000 × 0.78120

= $1,400,330.23  + $3,124,793.61

= $4,525,123.84

You might be interested in
Which accounting assumption or principle is being violated if a company is a party to major litigation that it may lose and deci
joja [24]
The accounting assumption is the full disclosure. For a business, the full disclosure rule requires an organization to give the important data with the goal that individuals who are acclimated to perusing monetary data can settle on educated choices concerning the organization. 
A disclosure is an extra data connected to an element's money related proclamations, normally as a clarification for exercises which have fundamentally affected the substance's monetary outcomes.
8 0
3 years ago
2) Food bill before tax: $80<br>Sales tax: 7.9% Tip: 20%​
dangina [55]

Grand Total + Total Bill Subtotal Sales Tax (7.9%)

Total Tip (20%)

Each Pays + Sales tax of 7.9% towards $80.00 is $6.32

A tip of 20% towards $86.32 is $17.26

does this help?

3 0
3 years ago
The production-inventory taxonomy is based on _____________ producing standardized products through an assembly line, while ____
UkoKoshka [18]

Answer:

system producing

intermittent system

Explanation:

The production-inventory taxonomy is based on continuos system producing standardized products through an assembly line, whille intermittent system are used to produce non standardized products through a job shop.

8 0
3 years ago
If the company were to issue an annual zero-coupon bond with a maturity of 2 years and par value of $1,000, what would be the ar
Contact [7]

Answer:

Note: <em>The complete question is attached as picture below</em>

1a. The one year spot rate can be calculated using the one year zero bond.

PV * (1 + S1) = FV

1 + S1 = 1000 / 900

S1 = 1.1111 - 1

S1 = 0.1111  

S1 = 11.11%

1b. PV of the 2 year bond = $950

Annual coupon = 1000 * 5% = $50

950 = 50 / (1 + S1) + (50 + 1000) / (1 + S2)^2

950 = 50 / 1.1111 + 1,050 / (1 + S2)^2

1,050/ (1 + S2)^2 = 950 - 45 = 905

(1 + S2)^2 = 1050 / 905

1 + S2 = 1.160221/2

S2 = 7.714%

1c. Price of the 2 year zero bond = 1,000 / (1 + 0.07714)^2

Price of the 2 year zero bond = 1,000 / 1.1602

Price of the 2 year zero bond = 861.9203586

Price of the 2 year zero bond = $861.92

3 0
2 years ago
What is a hold?
Jlenok [28]

Answer:

The hold is that the $100 won't go in.

Explanation:

4 0
3 years ago
Read 2 more answers
Other questions:
  • Natalie operates on a pretty tight budget. She is a price-conscious shopper and usually buys store or generic brands to save mon
    9·1 answer
  • Politics, law, culture, and economy are all examples of ________ factors that can affect the ways in which companies produce and
    12·1 answer
  • Mark, the business head of a firm, wanted to give New Year’s gifts to his employees. He discussed this with his employees and de
    14·1 answer
  • Many people are familiar with swot analysis—analyzing strengths, weaknesses, opportunities, and threats—which is used to aid in
    11·1 answer
  • Which of the following is measured by utility? A. The satisfaction a person gets from consumption. B. The cost of adding a singl
    7·1 answer
  • Which of the following is performed by enterprise application integration?
    6·1 answer
  • 16. Who has the control and management of company? (1) (a) Managing committee (b) Partners
    6·1 answer
  • Outline 2 reasons for completing assigned tasks daily​
    6·1 answer
  • After the stomach food passes through
    14·1 answer
  • Could someone explain to me what the money market in Italy is, thank you all​
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!