! Required information [The following information applies to the questions displayed below.] On January 1 of this year, Cunningham Corporation issued bonds with a face value of $200,000 and a coupon rate of 6 percent. The bonds mature in 10 years and pay interest annually every December 31. When the bonds were sold, the annual market rate of interest was 8 percent. The company uses the effective-interest amortization method. By December 31 of this year, the annual market rate of interest had increased to 10 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1) Note: Use appropriate factor(s) from the tables provided. Required: 1. What is the issuance price of the bonds on January 1? Note: Round your intermediate calculations and final answer to nearest whole dollar amount.
! Required information [The following information applies to the questions displayed below.] On January 1 of this year, Cunningham Corporation issued bonds with a face value of $200,000 and a coupon rate of 6 percent. The bonds mature in 10 years and pay interest annually every December 31. When the bonds were sold, the annual market rate of interest was 8 percent. The company uses the effective-interest amortization method. By December 31 of this year, the annual market rate of interest had increased to 10 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1) Note: Use appropriate factor(s) from the tables provided. Required: 1. What is the issuance price of the bonds on January 1? Note: Round your intermediate calculations and final answer to nearest whole dollar amount.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 1RE
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![!
Required information
[The following information applies to the questions displayed below.]
On January 1 of this year, Cunningham Corporation issued bonds with a face value of $200,000 and a coupon rate of 6
percent. The bonds mature in 10 years and pay interest annually every December 31. When the bonds were sold, the
annual market rate of interest was 8 percent. The company uses the effective-interest amortization method. By December
31 of this year, the annual market rate of interest had increased to 10 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1)
Note: Use appropriate factor(s) from the tables provided.
Required:
1. What is the issuance price of the bonds on January 1?
Note: Round your intermediate calculations and final answer to nearest whole dollar amount.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F49fd0b2a-7700-45db-9705-caf29792570a%2F61206caa-1e15-4d8c-9194-ad38f23b56fc%2Fyic7if_processed.jpeg&w=3840&q=75)
Transcribed Image Text:!
Required information
[The following information applies to the questions displayed below.]
On January 1 of this year, Cunningham Corporation issued bonds with a face value of $200,000 and a coupon rate of 6
percent. The bonds mature in 10 years and pay interest annually every December 31. When the bonds were sold, the
annual market rate of interest was 8 percent. The company uses the effective-interest amortization method. By December
31 of this year, the annual market rate of interest had increased to 10 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1)
Note: Use appropriate factor(s) from the tables provided.
Required:
1. What is the issuance price of the bonds on January 1?
Note: Round your intermediate calculations and final answer to nearest whole dollar amount.
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