Kellogg issued 20-year bonds. which of the following ratios will the bondholders most likely monitor to assess the Kellogg's ability to make its payments? Times interest earned ratio inventory turnover return on assets capital intensity ratio profit margin
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Kellogg issued 20-year bonds. which of the following ratios will the bondholders most likely monitor to assess the Kellogg's ability to make its payments?
Times interest earned ratio
inventory turnover
capital intensity ratio
profit margin
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- On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated interest rate of 12% payable semi-annually on July 1 and January 1. The bonds were sold to yield 10%. Assuming the bonds were sold at 107.732, what is the selling price of the bonds? Were they issued at a discount or a premium?Victoria Company has investments in marketable securities classified as trading and available-for-sale. At the beginning of the year, the aggregate market value of each portfolio exceeded its amortized cost. During the year, Victoria sold some securities from each portfolio. At the end of the year, the aggregate amortized cost of each portfolio exceeded its market value. Victoria also has investments in bonds classified as held-to-maturity, all of which were purchased for face value. During the year, some of these bonds held by Victoria were called prior to their maturity by the bond issuer. Three months before the end of the year, additional similar bonds were purchased for face value plus 2 months accrued interest. Required: 1. Explain how Victoria accounts for: a. sale of securities from each portfolio b. each equity securities portfolio at year-end 2. Explain how Victoria accounts for the disposition prior to their maturity of the long-term bonds called by their issuer. 3. Explain how Victoria reports the purchase of the additional similar bonds at the date of the acquisition.Krystian Inc. issued 10-year bonds with a face value of $100,000 and a stated rate of 4% when the market rate was 6%. Interest was paid semi-annually. Calculate and explain the timing of the cash flows the purchaser of the bonds (the investor) will receive throughout the bond term. Would an investor be willing to pay more or less than face value for this bond?
- OShea Inc. issued bonds at a face value of $100,000, a rate of 6%, and a 5-year term for $98,000. From this information, we know that the market rate of interest was ________. A. more than 6% B. less than 6% C. equal to 6% D. cannot be determined from the information given.If Intervale Railway invests $100,000 in 5% bonds at face value that the company intends to hold until the bond maturity date, the interest revenue recognized when each semiannual interest payment is received would be recorded as a a. credit to Cash, $2,500. b. credit to Interest Revenue, $2,500. c. debit to Long-term Investments—Held-to-Maturity, $2,500. d. debit to Dividend Revenue, $2,500.If Intervale Railway invests $100,000 in 5% bonds at face value that the company intends to hold until the bond maturity date, the interest revenue recognized when each semiannual interest payment is received would be recorded as a credit to Cash, $2,500. credit to Interest Revenue, $2,500. debit to Long-term Investments—Held-to-Maturity, $2,500. debit to Dividend Revenue, $2,500.
- Enviro Company issues 12.00%, 10-year bonds with a par value of $460,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 9.00%, which implies a selling price of 128.625. The straight-line method is used to allocate interest expense. What are the issuer's cash proceeds from issuance of these bonds? What total amount of bond interest expense will be recognized over the life of these bonds? What is the amount of bond interest expense recorded on the first interest payment date?Assume Lyda Inc. sold bonds with a face value of P500,000 for P530,000. Was the market interest rate equal to or greater than the bonds’ contractual interest rate? What are the financial ratios used to analyze current liabilities and long-term liabilities?On January of the current year, Banek Inc issued $350,000 of 8% nine year bonds for $309,086, which implies a market (yield) rate of 10%. Semiannual interest is payable on June 30 and December 31 each year. Show computation to confirm the bond issue price Indicate the financial statement effects using the template for (1) bond issuance, (2) semiannually interest payment and discount amortization on June 30 of the current year, and (3) semiannual interest payment and discount amortization on December 31 of the current year.
- On January 1, 2024, Baddour, Incorporated, issued 10%, 12-year bonds with a face amount of $176 million. The bonds were priced at $154 million to yield 12%. Interest is paid semiannually on June 30 and December 31. Baddour’s fiscal year ends September 30. Required: What amount(s) related to the bonds would Baddour report in its balance sheet at September 30, 2024? What amount(s) related to the bonds would Baddour report in its income statement for the year ended September 30, 2024? What amount(s) related to the bonds would Baddour report in its statement of cash flows for the year ended September 30, 2024? In which section(s) should the amount(s) appear? Note: For all requirements, enter your answers in whole dollars.Renfro Company issued $300,000 of 8%, 10-year bonds at 102. Interest is paid annually, and the straight-line method is used for amortization. Assume that the market rate for similar investments is 7%. The bonds are issued on the date of the bonds. a. What amount was received for the bonds? b. How much interest is paid each interest period? c. What is the premium amortization for the first interest period?The following table lists several corporate bonds issued during a particular quarter. If the General Electric bonds you purchased had paid you a total of $6,630 at maturity, how much did you originally invest? (Round your answer to the nearest dollar.) = $
