TRUE OR FALSE? 1. Cash set aside for bonds payable that will mature in five years is shown as current asset.
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TRUE OR FALSE?
1. Cash set aside for bonds payable that will mature in five years is shown as current asset.
2.
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- If $1488000 of bonds are issued during the year but $3100000 of old bonds are retired during the year, the statement of cash flows will show a(n)The total interest expense over the 5-year life of the bonds is $100,000. How will the issuance of these bonds on January 1, Year 1 be reported on OSU’s Cash Flow Statement? Is it inflow or outflowOn July 1 of the current year, an entity received a one-year note receivable bearing an interest rate at the market rate of interest. The face amount of the note receivable and the entire amount of interest are due in one year. This note should be recorded at A. Discounted value of cash flows B. Face value C. Fair value D. Maturity value
- 52 All of the following are current liabilities, except: Group of answer choices Serial bonds maturing in two years which are to be paid from sinking fund which is classified as noncurrent. Deposit on special orders from customers to be filled within one year. Accounts payable to be paid from cash on hand. Property dividends issuable, to be paid in inventory of the issuing firm within one year from the current statement of financial position date.All of the following affect the balance of the capital account except? bank deposits. purchases of government and corporate securities. purchases of goods and services. loans. These bonds have their coupons reset every two or three years to reflect the current interest rate environment and any changes in the firm’s credit quality? Callable bonds Put bonds Treasury Inflation Protected Securities Extendable notesA ten-year bond was issued at par for $250,000 cash. This transaction should be shown on a statement of cash flows under a. noncash investing and financing activities b. operating activities c. investing activities d. financing activities
- Bonds pay the face value to the investor when they are a. held over 10 years. b. held 20 years. c. held until maturity. d. sold on the market before maturity.Given the following information, calculate the duration of assets and liabilities. Assets Amount Rate Duration Cash 90 Loans 800 12% 2 years Treasuries 110 9% 8 years Liabilities and Equity Time deposits 500 6% 1.75 years CDs 425 8% 2.50 years Equity 751. How much gain or (loss) should be recognized on the sale of Orange bonds? 2. How much unrealized gain or (loss) is to be recognized in the income statement for the current year? 3. How much is the interest income at year end?
- (Classification) The following items are found in the financial statements.(a) Discount on bonds payable.(b) Interest expense (credit balance).(c) Unamortized bond issue costs.(d) Gain on repurchase of debt.(e) Mortgage payable (payable in equal amounts over next 3 years).(f) Debenture bonds payable (maturing in 5 years).(g) Notes payable (due in 4 years).(h) Premium on bonds payable.(i) Bonds payable (due in 3 years). InstructionsIndicate how each of these items should be classified in the financial statements.A company issues €1 million of bonds at face value. When the bonds are issued, the company will record a:A . cash infl ow from investing activities.B . cash infl ow from fi nancing activities.C . cash infl ow from operating activities.Assume you have the following asset and liability in your balance sheet Asset - Bond AModified Duration = 1.5 yearsValue = RM1 million Liability - Bond BModified Duration 2.6 yearsValue = RM2 million a. Calculate the duration gaps?b. What is the expected change in Net worth if interest increases by 1%?c. What should or could you to achieve immunised balance sheet?
