just the subpart e please thank you so much, i appreciate it! 3. Third Avenue Railroad Company First Gold 5s were bonds (issued by theThird Avenue Railroad Company) that matured on 1 July 1937. Theypaid coupons on 1 July and 1 January. We observe the following pricesDate30 June 193731 December 193631 August 193631 May 193631 December 193531 January 193531 May 193431 March 193331 March 193231 July 193131 March 193131 January 193130 September 193031 July 193031 May 192930 June 192831 January 192831 December 192731 August 192731 May 1927Price Credit rating89101102.75102.75100.25101.62598.5879010095.259897.375969199.5100.599.759999.75BaaBaaBaaBaaBaaBaaBaaBaaBaaBaaAAAAAaAaAaAaAaAaThe bond had accrued interest calculated using US 30/360 (it was a cor-porate bond in the U.S.).(a) Use the YIELD command in excel to calculate the bond's yield tomaturity on each of the dates.i. 31 May 1927 to 31 July 1931?ii. 31 July 1931 to 30 June 1937?(f) What was the effective annual return fori. 31 May 1927 to 31 July 1931?ii. 31 July 1931 to 30 June 1937?(b) How is the bond's yield to maturity related to its credit rating?(c) What is happening on 30 June 1937?(d) Calculate the dirty price (including accrued interest) oni. 31 May 1927,ii. 31 July 1931,iii. 30 June 1937.Hint: you may find the ACCRINT command in excel useful here.(e) What was the holding period return for an investor who held thebond from

As per instructions only question e will be solved. Holding Period return is calculated with the…

Answered: (e) What was the holding period return…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter11: Notes, Bonds, And Leases

Section: Chapter Questions

Problem 22E

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The Pennington Corporation issued a new series of bonds on January 1, 1979. The bonds were sold at par (P1,000), have a 12% coupon, and mature in 30 years on December 31, 2008. Coupon payments are made semiannually (on June 30 and December 31).(a) What was the YTM of Pennington’s bonds on January 1, 1979?(b) What was the price of the bond on January 1, 1984, 5 years later assuming that the level of interest rate had fallen to 10%?(c) Find the current yield and capital gains yield on the bond on January 1, 1984, given the price as determined in Question b.(d) On July 1, 2002, Pennington’s bonds sold for P916.42. What was the YTM at that date?(e) What were the current yield and capital gains yield on July 1, 2002
On July 1, 20X1, Mirage Company issued $250 million of bonds with an 8% coupon interest rate. The bonds mature in 10 years and pay interest semiannually on June 30 and December 31 of each year. The market rate of interest on July 1, 20X1, for bonds of this risk class was 8%. Mirage closes its books on December 31. Ignore income taxes. Use the following links to the present value tables to calculate answers. (PV of 1, PVAD of 1, and PVOA of 1) (Use the appropriate factor(s) from the tables provided.) Required: At what price were the bonds issued? On July 1, 20X3, the market interest rate for bonds of this risk class is 6%. What is the fair value of the bonds on this date? Suppose that 50% of the bonds were repurchased for cash on July 1, 20X3, at the market price. What journal entry would the company make to record this partial retirement? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate…
The Pennington Corporation issued a new series of bonds on January 1, 1978. The bonds were sold at par ($1,000), have a 12 percent coupon, and mature in 30 years, on December 31, 2007. Coupon payments are made semiannually (on June 30 and December 31). What was the YTM of Pennington’s bonds on January 1, 1978? 2. What was the price of the bond on January 1, 1983, 5 years later, assuming that the level of interest rates had fallen to 10 percent? 3. Find the current yield and capital gains yield on the bond on January 1, 1983, given the price as determined in part b. 4. On July 1, 2001, Pennington’s bonds sold for $916.42. What was the YTM at that date? 5. What were the current yield and capital gains yield on July 1, 2001?
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Smashing Cantaloupes Inc. issued 5-year bonds with a par value of $35,000 and an 8% semiannual coupon (payable June 30 and December 31) on January 1, 2018, when the market rate of interest was 10%. Were the bonds issued at a discount or premium? Assuming the bonds sold at 92.288, what was the sales price of the bonds?

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(e) What was the holding period return for an investor who held the bond from i. 31 May 1927 to 31 July 1931? ii. 31 July 1931 to 30 June 1937?