Hartford Research issues bonds dated January 1 that pay interest semiannually on June 30 and December 31. The bonds have a $39,000 par value and an annual contract rate of 8 %, and they mature in 10 years. (Table B.1, Table B.2, Table B.3, and Table B.4) Note: Use appropriate factor(s) from the tables provided. Round all table values to 4 decimal places, and use the rounded table values in calculations. Required: Consider each separate situation. 1. The market rate at the date of issuance is 6%. (a) Complete the below table to determine the bonds' issue price on January 1. (b) Prepare the journal entry to record their issuance. 2. The market rate at the date of issuance is 8%. (a) Complete the below table to determine the bonds' issue price on January 1. (b) Prepare the journal entry to record their issuance. 3. The market rate at the date of issuance is 10%. (a) Complete the below table to determine the bonds' issue price on January 1. (b) Prepare the journal entry to record their issuance. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 28 Required 3A Required 3B Complete the below table to determine the bonds' issue price on January 1 if the market rate at the date of issuance is 6%. Note: Round all table values to 4 decimal places. Table values are based on: n= i= Cash Flow Par (maturity) value Interest (annuity) Price of bonds 3 X 20.0% X Table Value 39.000.0000 Amount Present Value < Required 1A Required 1B >
Hartford Research issues bonds dated January 1 that pay interest semiannually on June 30 and December 31. The bonds have a $39,000 par value and an annual contract rate of 8 %, and they mature in 10 years. (Table B.1, Table B.2, Table B.3, and Table B.4) Note: Use appropriate factor(s) from the tables provided. Round all table values to 4 decimal places, and use the rounded table values in calculations. Required: Consider each separate situation. 1. The market rate at the date of issuance is 6%. (a) Complete the below table to determine the bonds' issue price on January 1. (b) Prepare the journal entry to record their issuance. 2. The market rate at the date of issuance is 8%. (a) Complete the below table to determine the bonds' issue price on January 1. (b) Prepare the journal entry to record their issuance. 3. The market rate at the date of issuance is 10%. (a) Complete the below table to determine the bonds' issue price on January 1. (b) Prepare the journal entry to record their issuance. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 28 Required 3A Required 3B Complete the below table to determine the bonds' issue price on January 1 if the market rate at the date of issuance is 6%. Note: Round all table values to 4 decimal places. Table values are based on: n= i= Cash Flow Par (maturity) value Interest (annuity) Price of bonds 3 X 20.0% X Table Value 39.000.0000 Amount Present Value < Required 1A Required 1B >
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Transcribed Image Text:Hartford Research issues bonds dated January 1 that pay interest semiannually on June 30 and December 31. The bonds have a
$39,000 par value and an annual contract rate of 8%, and they mature in 10 years. (Table B.1, Table B.2, Table B.3, and Table B.4)
Note: Use appropriate factor(s) from the tables provided. Round all table values to 4 decimal places, and use the rounded table
values in calculations.
Required:
Consider each separate situation.
1. The market rate at the date of issuance is 6%.
(a) Complete the below table to determine the bonds' issue price on January 1.
(b) Prepare the journal entry to record their issuance.
2. The market rate at the date of issuance is 8%.
(a) Complete the below table to determine the bonds' issue price on January 1.
(b) Prepare the journal entry to record their issuance.
3. The market rate at the date of issuance is 10%.
(a) Complete the below table to determine the bonds' issue price on January 1.
(b) Prepare the journal entry to record their issuance.
Complete this question by entering your answers in the tabs below.
Required 1A Required 1B Required 2A Required 2B Required 3A Required 3B
Complete the below table to determine the bonds' issue price on January 1 if the market rate at the date of issuance is 6%.
Note: Round all table values to 4 decimal places.
Table values are based on:
n=
1=
X Answer is not complete.
Cash Flow
Par (maturity) value
Interest (annuity)
Price of bonds
3 x
20.0% X
Table Value
39,000.0000 X
Amount
Present Value
< Required 1A
Required 1B >
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