On January 1, 20x1, ABC Co. issued 1,000, ₱4,000, 12%, 3-year bonds. Principal is due on December 31, 20x3 but interests are due annually every year-end. The effective interest rate is 10%. How much is the initial value of the bonds? PV of P1 at 12% for 3n = . 71178 PV of P1 at 10% for 3n = .75131 PV ordinary annuity at 12% for 3n = 2.40183 PV ordinary annuity at 10% for 3n = 2.48685 3,005,240 3,807,852 4,000,000 4,198,928

On January 1, 20x1, ABC Co. issued 1,000, ₱4,000, 12%, 3-year bonds. Principal is due on December 31, 20x3 but interests are due annually every year-end. The effective interest rate is 10%. How much is the initial value of the bonds? PV of P1 at 12% for 3n = . 71178 PV of P1 at 10% for 3n = .75131 PV ordinary annuity at 12% for 3n = 2.40183 PV ordinary annuity at 10% for 3n = 2.48685 3,005,240 3,807,852 4,000,000 4,198,928

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 18MC: OShea Inc. issued bonds at a face value of $100,000, a rate of 6%, and a 5-year term for $98,000....

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