Calculate the bond selling price for the following three separate scenarios. a. 33M Corp. authorized and issued $100,000, 6%, 20-year bonds payable on January 1. Calculate the selling price of the bonds if the bonds pay cash interest semiannually on July 1 and January 1, and the market rate on similar bonds is 8%. b. 33M Corp. authorized and issued $250,000, 7%, 10-year bonds payable on January 1. Calculate the selling price of the bonds if the bonds pay cash interest semiannually on July 1 and January 1, and the market rate on similar bonds is 6%. c. 33M Corp. issued $75,000, 5%, 10-year bonds payable on March 31 of Year 1. The bonds were authorized on January 1 of Year 1. Calculate the selling price of the bonds (including interest) if the bonds pay cash interest annually on January 1, and the market rate on similar bonds is 6%. Note: Round answers to the nearest whole dollar. a. $ 80,207 ✔ b. $ 268,597 ✔

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter9: Long-term Liabilities
Section: Chapter Questions
Problem 15MCQ
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Determining Bond Selling Price
Calculate the bond selling price for the following three separate scenarios.
a. 33M Corp. authorized and issued $100,000, 6%, 20-year bonds payable on January 1. Calculate the selling price of the bonds if the bonds pay cash
interest semiannually on July 1 and January 1, and the market rate on similar bonds is 8%.
b. 33M Corp. authorized and issued $250,000, 7%, 10-year bonds payable on January 1. Calculate the selling price of the bonds if the bonds pay cash
interest semiannually on July 1 and January 1, and the market rate on similar bonds is 6%.
c. 33M Corp. issued $75,000, 5%, 10-year bonds payable on March 31 of Year 1. The bonds were authorized on January 1 of Year 1. Calculate the selling
price of the bonds (including interest) if the bonds pay cash interest annually on January 1, and the market rate on similar bonds is 6%.
Note: Round answers to the nearest whole dollar.
a. $
80,207
b. $
268,597
C. $ 69,479 *
Transcribed Image Text:Determining Bond Selling Price Calculate the bond selling price for the following three separate scenarios. a. 33M Corp. authorized and issued $100,000, 6%, 20-year bonds payable on January 1. Calculate the selling price of the bonds if the bonds pay cash interest semiannually on July 1 and January 1, and the market rate on similar bonds is 8%. b. 33M Corp. authorized and issued $250,000, 7%, 10-year bonds payable on January 1. Calculate the selling price of the bonds if the bonds pay cash interest semiannually on July 1 and January 1, and the market rate on similar bonds is 6%. c. 33M Corp. issued $75,000, 5%, 10-year bonds payable on March 31 of Year 1. The bonds were authorized on January 1 of Year 1. Calculate the selling price of the bonds (including interest) if the bonds pay cash interest annually on January 1, and the market rate on similar bonds is 6%. Note: Round answers to the nearest whole dollar. a. $ 80,207 b. $ 268,597 C. $ 69,479 *
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