20. The computer of your neighbor, who is an accountant, was hacked by mystical creatures. Your neighbor needs your help in reconstructing the amortization table for his company's investment in 3-year bonds: B. D. 1. Date Interest received Interest income Amortization Present value 2. 1/1/x1 .. ... 3 12/31/x1 280,000 2,067,602 4. 12/31/x2 31,888 2,035,714 12/31/x3 280,000 244,286 How much is the face amount of the bonds and what is the effective interest rate? a. 2,096,073; 12% b. 2,000,000; 12% c. 2,071,428; 14% d. I don't know. My brain is hacked too!

20. The computer of your neighbor, who is an accountant, was hacked by mystical creatures. Your neighbor needs your help in reconstructing the amortization table for his company's investment in 3-year bonds: B. D. 1. Date Interest received Interest income Amortization Present value 2. 1/1/x1 .. ... 3 12/31/x1 280,000 2,067,602 4. 12/31/x2 31,888 2,035,714 12/31/x3 280,000 244,286 How much is the face amount of the bonds and what is the effective interest rate? a. 2,096,073; 12% b. 2,000,000; 12% c. 2,071,428; 14% d. I don't know. My brain is hacked too!

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 9MCQ

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Prepare journal entries to capture the following events. Please ignore the interests and bond amortization. Use a tax rate of 20% if you need one. 1.12/15/2021: Purchased $200,000 of Harbox bonds, which is viewed as an AFS investment. 2.12/31/2021: Estimated the fair value of the Harbox investment at $187,000. 3.1/15/2022: Sold the Harbox investment for $162,000 and made all necessary entries to remove the Harbox investment from the accounts: a.Sale of investments: b.Reclassification (For expediency, you don’t need to record the temporary unrealized gains/losses between 12/31/2021 and 1/15/2022, since they will be reversed anyways):
journal entries to capture the following event. ignore the interests and bond amortization. Use a tax rate of 20%. 12/15/2021: Purchased $200,000 of Harbox bonds, which is viewed as an AFS investment.
APhP10000,5%bondwithsemiannualcouponsispricedtoyield7%.Findthepriceifthebondis redeemable at par at the end of 20 years. a. PhP 8,160.80 b. PhP 7,864.49 c. PhP 7,578.76 d. PhP 7,160.90
(a) Describe the details of the bonds issued. (b) Assume that you are the accountant of one of the investors of the bonds. The investor purchased P10, 000,000.00 of RTB in February. Prepare journal entries for the purchase of the RTBs, accrual of interest and when the bonds are redeemed. (c) Why do you think the Government issues bonds? (d) Do you think issuing bonds by the government is effective and does it achieve its purpose? (e) Aside from issuing bonds, what do you suggests as other means of funding or can government source funds other than bonds?
Please provide solutions and explanation. Thank you so much. 1. On April 1, 20x1, Ronald Ryan Co. acquired 12%, P4,000,000 bonds dated January 1, 20x1 at 98 including interest. The bonds mature on December 31, 20x3 but pays annual interest at each year-end. How much is the initial carrying amount of the investment? a. 3,920,000 b. 3,800,000 c. 4,000,000 d. 4,120,000 2. On January 1, 20x1, Mitch Co. acquired 12%, P4,000,000 bonds at 98. Commission paid to brokers amounted to P204,000. Principal is due on December 31, 20x4 but interest payments are made annually starting December 31, 20x1. The adjusted effective interest rate on the investment is closest to a. 12% b. 11% c. 10.2650% d. indeterminable 3. Use the following information for the next three questions: On January 1, 20x1, ABC Co. acquired 10%, ₱1,000,000 bonds for ₱827,135. The bonds mature on December 31, 20x3 and pay annual interest every December 31. ABC Co. incurred transaction costs ₱80,000 on the acquisition.…
Cha, a registered engineer wanted to establish her own business. She planned to borrow a long term fund thru the use of bonds. A P350,000, 12% bond is being paid on dividends on semi-annual basis. This will be redeemed at P385,000 on September 21, 2019. It was bought on September 21, 2016 to yield an 8% interest. Using the data given, find the price of the bond.
Good day! These two questions below are interconnected, so please do answer them, dear tutor. thank you very much Use the following information for the next two questions:On January 1, 20x1, ABC Co. acquired 14%, ₱1,000,000 bonds for ₱1,099,474. The principal is due onDecember 31, 20x3 but interest is due annually starting December 31, 20x1. The effective interest rate onthe bonds is 10%. The bonds are classified as investment measured at amortized cost. 1. How much is the carrying amount of the investment on December 31, 20x2?a. 1,000,000 b. 1,036,364 c. 1,069,421 d. 1,044,312 2. Assume that half of the investment was sold on January 1, 20x2 for ₱480,000. Transaction costsincurred on the sale amounted to ₱15,000. How much is the gain (loss) on the sale?a. (54,711) b. (39,711) c. 16,341 d. (69,711)
18. An engineer has a current balance of P110 000.00 in his savings account. The bank will be giving 6% interest compounded semi-annually for the next two years and 8% interest compounded semi-annually thereafter. A large corporation is offering P10 000.00, 8% bonds that pay interest every six months for P11 000.00. If the maturity is five years, and bond earnings are deposited in the bank, should he withdraw and purchase the bonds, or should he leave his savings in the bank? Use future worth analysis. (Ans. Money should be left in the bank; P156 654.05; P147 706.39)
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Assume you have the following asset and liability in your Balance Sheet:Asset - Bond AModified Duration = 2.6 yearsValue= RM1.5 millionLiability - Bond BModified Duration = 3.1 yearsValue= RM1.0 million duration gap is 0.53 years, net worth reduce by 8000. What should or could you to achieve immunized balance sheet?
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company has made an investment in government bonds. The bonds will generate an interest income of OMR 15351 each year for 6 years. The interest rate is 12% annually. Compute present value of the stream of interest income for 6 years. Select one: a. All the given choices in this question are not correct b. 78465.21 c. 3733.76 d. 47763.21 e. 63114.21 Clear m