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C. COMPUTATION TIME #08-03 On January 1, 2015, Mac Inc, issued Php3,000,000 bonds with a coupon rate of B% maturing in 4 years. The interest is paid annually, and the market interest rate at the date of issue was 11%. Required: 1. Is the bond issued at discount or at premium? 2. Compute for the issue price of the bond by preparing the 4-year amortization schedule for the bond. Please copy the amortization table below and write down your answer. 3.900.000 Principal = 1,976,192.92

C. COMPUTATION TIME #08-03 On January 1, 2015, Mac Inc, issued Php3,000,000 bonds with a coupon rate of B% maturing in 4 years. The interest is paid annually, and the market interest rate at the date of issue was 11%. Required: 1. Is the bond issued at discount or at premium? 2. Compute for the issue price of the bond by preparing the 4-year amortization schedule for the bond. Please copy the amortization table below and write down your answer. 3.900.000 Principal = 1,976,192.92

Financial Accounting Intro Concepts Meth/Uses
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter11: Notes, Bonds, And Leases
Section: Chapter Questions
Problem 18E
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C. COMPUTATION TIME #08-03 On January 1, 2015, Mac Inc, issued Php3,000,000 bonds with a coupon rate of B% maturing in 4 years. The interest is paid annually, and the market interest rate at the date of issue was 11% Required: 1. Is the bond issued at discountor at premium? 2. Compute for the issue price of the bond by preparing the 4-year amortization schedule for the bond. Please copy the amortization table below and write down your answer. 3,000.000. Principal =1,976,192.92 Interest Issue Price Interest Expense (carrying amount x11%) Carying Balance Period Interest to be Paid Php3,000,000 x 8% Amortization af Discount (Interest Exp.-Int. Paid) 240,000 240,000 240,000 240,000 2. 3 4.
Transcribed Image Text:C. COMPUTATION TIME #08-03 On January 1, 2015, Mac Inc, issued Php3,000,000 bonds with a coupon rate of B% maturing in 4 years. The interest is paid annually, and the market interest rate at the date of issue was 11% Required: 1. Is the bond issued at discountor at premium? 2. Compute for the issue price of the bond by preparing the 4-year amortization schedule for the bond. Please copy the amortization table below and write down your answer. 3,000.000. Principal =1,976,192.92 Interest Issue Price Interest Expense (carrying amount x11%) Carying Balance Period Interest to be Paid Php3,000,000 x 8% Amortization af Discount (Interest Exp.-Int. Paid) 240,000 240,000 240,000 240,000 2. 3 4.
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