Answered: Discuss what factors may cause a…

Business

Accounting

Discuss what factors may cause a debenture is issued at discount, premium and par value. (550 words

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 9MC: The process that determines the present value of a single payment or stream of payments to be...

See similar textbooks

Related questions

Q: To which element does the following definition correspond: It is a format where interest and…

A: Loan A loan refers to the amount which is borrowed from a financial or a non-financial institution.…

Q: are, in essence, an insurance contract against the default of one or more borrowers.

A: A credit default swap (CDS) is a financial derivative or contract that allows an investor to "swap"…

Q: Gross selling price includes: I. the amount of the seller's debt assumed by the buyer. II. the fair…

A: Selling price means the rate at which the goods are sold or services are provided by the…

Q: see attached pictures for questions

A: i) The fair value of the fixed rate debt at February 28, 2004 is $2,640,995, as since this…

Q: What are the similarities and dissimilarities of the three governing laws on installment sales: the…

A: The Maceda Law and the Recto Law are not the same. Both laws are used for the property on the…

Q: S1: In note discounting treated as a secured borrowing, a contingent liability is recognized on the…

A: Contingent liability: Contingent liability can be defined as the liability that may arise in future…

Q: Which one of the following options is correct for a journal entry creating provision for warranty…

A: SOLUTION- THE COMPANY NEEDS TO MAKE PROVISION OF WARRANTY WHEN IT SELLS THE PRODUCT WITH THE…

Q: The adjustment will increase the warranty expense, if the actual cost of warranty exceeds the…

A: Answer: Warranty is the promise that is made by business on any product that is being sold.

Q: Title Explain how a borrowing cost could arise as part of the measurement of a provision. Illustrate…

A: Hello. Since your question has multiple parts, we will solve the first question for you. If you want…

Q: Assuming the contract entered into at the price you computed is $365.42 and the underlying asset is…

A: Forward Contract: When two parties agree to purchase or sell a certain asset at a given price on a…

Q: A contractual agreement in which the borrower receives something of value now and agrees to pay the…

A: Solution: A contractual agreement in which the borrower receives something of value now and agrees…

Q: What is the treatment of transaction costs from issuance to a bond payable measured using the…

A: Transaction costs: Transaction costs also known as issue costs, are those costs that are incurred…

Q: Assume you are working in public accounting and the client you are assisting has a question on the…

A: A bond discount expense has been incurred and being an employee for a Public Accounting what…

Q: Question 2 of 18 For trade receivables, the fair value is deemed equal to the Select the correct…

A: trade receivable are considered to be asset of the business. receivable arises when sale is made by…

Q: TRUE or FALSE. In discounting of customer’s note under conditional sale, an account “Note…

A: Solution Concept Discounting of customers note It means that when we receive the note…

Q: Under a 75% LTV term loan structure, when is the balance of funds released by the lender to the…

A: Borrowing to purchase an asset: An asset can be purchased by taking a loan from a financial…

Q: hich of the following best describes the accounting for assurance-type warranty costs?

A: Since an assurance-type warranty guarantees the functionality of a product, the warranty is not…

Q: When a note payable is issued for property, goods, or services, the present value of the note maybe…

A: The note payable is issued to creditors which is to be paid off at the maturity date.

Q: If your school has a subscription to the FASB Codification, log in and prepare responses to the…

A: Financial Accounting Standard Board (FASB) refers to the board that governs GAAP (generally accepted…

Q: What is meant by Premium on redemption of debentures account?

A: Premium on redemption of debenture account: Premium on redemption of debenture is the amount paid to…

Q: Statement 1 : In accordance with IFRS 15, in accounting for customer premiums, the transaction price…

A: IFRS 15 is an accounting standard for recognition of revenue from contracts with customers. The…

Q: he following are based on FASB Codification. #1. Describe the accounting for refund liabilities.

A: Refund liability states the consideration amount which business does not expect to be entitled to as…

Q: What is meant by ‘Issue of debenture at discount and redeemable at premium?

A: Bonds: Bonds are debt instruments issued by the borrower company to its lenders. Bonds are issued…

Q: Loans and receivable should be measured subsequent to initial recognition at * a. Amortized cost…

A: The question is multiple choice question. Required Choose the Correct Option.

Q: Bond discount should be presented in the financial statements of the issue as a(n) Contra liability…

A: >Bond discount is recorded in the books of account as the difference between Face value of Bond…

Q: Under IFRS 2, Share-Based Payment, the value of the options that lapse after vesting shall be…

A: IFRS 2, Share-Based Payments provides guidance on accounting for the share option granted. The…

Q: An issuer of a cheque is called: a. Payee b. Drawee c. Endorser d. Draw

A: solution : a cheque is instrument to draw the money from bank account . A cheque is issued to other…

Q: It is a receivable financing activity where the Entire Receivable's ownership is sold to the Factee…

A: Generally company makes credit sales and suffer the bad debts on some of the credit sales. To over…

Q: Describe the conditions that would make the use of advance-discounts appropriate.

A: Discount means a selling of goods or service below the price of goods. This reduction in price is…

Q: An item that is not a contingent liability is: A. premium offer to customers for labels or box cops.…

A: Answer: An item that is not a contingent liability is : option A: premium offer to customers for…

Q: amortized debt premium should be reported on the balance sheet of the insurer as a Group of answer…

A: The bonds are issued at premium or discount to face value of bond. The issuer has to pay the premium…

Q: The adjustment to be made for provision for doubtful debt is O a. Credit profit and loss account…

A: The provision for doubtful debts is also known bad debts or losses on account receivables.

Q: When the amount of rebate on bills discounted shown in the adjustments, then it has to be: a.…

A: When the amount of rebate on bills discounted shown in the adjustments, then it has to be Deducted…

Q: Trade receivables are preferably presented on the face of the statement of financial position Select…

A: Solution: Trade receivables are the receivables arises from sales of goods or Sales of services.…

Q: Which of the following statements regarding valuation discounts is CORRECT? The blockage interest…

A: The correct answer for the above mentioned question is given in the following steps for your…

Q: What are the three elements of the definition for liabilities? List from the following items that…

A: Liabilities are the obligations of the individuals or the company which have to be paid back after a…

Q: ind the total cost of the federal unsubsidized loan. Round answer to two decimal places, if…

A: The monthly payment is a mount that is paid on every month for amortize the loan that include the…

Q: Explain the characteristics of a bill of exchange and state the ways a bill of exchange Inay be…

A: The question is related to Bill of exchange. A Bill of Exchange has been defined as an instrument in…

Q: Which statement is true when a debt investment at amortized cost is reclassified to FVOCI? a.…

A: Under the International Financial Reporting Standard (IFRS) 9, reclassification of the financial…

Q: The alternative treatment in reporting Subscription Receivable is a. deduction to Current Assets…

A: Subscription receivable is a revenue receivable that is an asset for the company.

Q: Can you explain Collateralized debt obligation

A: A collateralized debt obligation (CDO) is a complicated dependent finance product this is…

Question

Discuss what factors may cause a debenture is issued at discount, premium and par value. (550 words)

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

What is meant by ‘Issue of debenture at discount and redeemable at premium?
Provide answer please! If the collection of the note receivable is reasonably assured, what is the net income to be recognized by the entity for the year ended December 31, 2020 in relation to the initial franchise fee?A. 98,850 C. 70,028B. 94,850 D. 92,037
For assets acquired on credit or by installment, the cost or fair value is equal to: A. cash purchase priceB. invoice priceC. installment priceD. list price
What is meant by Premium on redemption of debentures account?
2. Which of the following best describes the accounting for assurance-type warranty costs? * 1 point a. Expensed when paid. b. Expensed when warranty claims are certain. c. Expensed based on estimate in year of sale. d. Expensed when incurred.
19. Which of the following best describes the accounting for assurance-type warranty costs? * a. Expensed when paid. b. Expensed when warranty claims are certain. c. Expensed based on estimate in year of sale. d. Expensed when incurred.
When the amount of rebate on bills discounted shown in the adjustments, then it has to be: a. Deducted from discounts received on bills and shown in other liabilities b. Deducted from discounts on bills purchased and shown in fixed assets c. Deducted from discounts received on bills and shown in other assets d. Added to discounts received on bills and shown in other liabilities
Explain using practical example how a discount on a debenture is treated ?
how are the origination fees borne by the borrower accounted for in relation to the initial measurement of a loan receivable a. Added to initial measurement of the loa receivable b. Deducted from the initial measurement of the loan receivable c. Ignored d. Either added to or deducted from the initial measurement of the loean receivable if the origination fees are at leasr 10% of the proncipal amount of the loan
The process that determines the present value of a single payment or stream of payments to be received is ________. A. compounding B. discounting C. annuity D. lump-sum
What is a key difference between a short-term note payable and a current portion of a noncurrent note payable?
Explain how the present value of an ordinary annuityinterest table is converted to the present value of anannuity due interest table.