Wildhorse Corporation, having recently issued a $ 20,110,400, 15-year bond issue, is committed to make annual sinking fund deposits of $ 612,200. The deposits are made on the last day of each year and yield a return of 10%. Click here to view factor tables Determine the amount of deficiency.
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Wildhorse Corporation, having recently issued a $ 20,110,400, 15-year bond issue, is committed to make annual sinking fund deposits of $ 612,200. The deposits are made on the last day of each year and yield a return of 10%.
Click here to view factor tables
Determine the amount of deficiency. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)
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- Bramble Corporation, having recently issued a $20,094,900, 15-year bond issue, is committed to make annual sinking fund deposits of $617,600. The deposits are made on the last day of each year and yield a return of 10%.Click here to view factor tablesDetermine the amount of deficiency. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) Deficiency $Bonita Corporation, having recently issued a $20,062,200, 15-year bond issue, is committed to make annual sinking fund deposits of $620,000. The deposits are made on the last day of each year and yield a return of 10%. Will the fund at the end of 15 years be sufficient to retire the bonds? If not, what will the deficiency be?Ace Co. has issued $10,000,000, 20-year bonds and plans to make annual sinking fund deposits of $240,000 at the end of each year in order to repay the bonds at maturity. a. Assuming the sinking fund yields a return of 7%, should the fund balance be sufficient to repay the bonds in 20 years? b. Compute the required annual sinking fund deposits needed to accumulate the $10,000,000 repayment.
- City Slicker Corporation pays $55,000 into a bond sinking fund each year for the future redemption of bonds. During the first year, the fund earns $1,475. When the bonds mature, there is a sinking fund balance of $612,000, and $600,000 is needed to redeem the bonds. Required:Prepare the following general journal entries. a. The initial sinking fund deposit. b. The first year's earnings. c. The redemption of the bonds. d. The return of excess cash to the corporation.Shoppi Company had the following amounts of long-term debt outstanding on December 31, 2019: 14% term note, due 2020. 30,000 11% term note, due 2022. 1,070,000 8% note, due in 11 equal annual principal payments. 1,100,000 Plus interest beginning Dec. 31,2020 7% guaranteed debentures, due 2021. 1,000,000 Total. 3,200,000 The annual sinking fund requirement on the guaranteed debentures is 40,000 per year. What total amount should be reported as current liabilities on December 31, 2019?Hassan Mustafa realized that when the bonds mature on January 20, 2041, there must be $5,200,000 available to repay the bondholders. To have enough money on hand to meet this obligation, He suggested that ScanSoft set up a sinking fund (an interest-bearing account into which payments are made at regular intervals to provide a desired sum of money at a specified future time) using a specially designated savings account. The company earns interest of 1.6% compounded semi-annually on this sinking fund account. ScanSoft began making semi-annual payments to the sinking fund on July 20, 2021.ScanSoft issued the bonds, sold them all to the investment dealer, and used the money raised to continue its research and development.1. How much would an investor have to pay for one of these bonds to earn 4.4% compounded semi-annually?2.3. Suppose ScanSoft discovers on January 20, 2031, that it can earn 2.5% interest compounded semi-annually on its sinking fund account.a. What is the balance in the…
- Able Company had the following amounts of long-term, debt outstanding at December 31, 2021: 14% term note, due 2022 30,000 11% term note, due 2009 1,070,000 8% note, due in 11 equal annual principal payments, plus interest beginning December 31, 2022 1,100,000 7% guaranteed debentures, due 2010 1,000,000 Total 3,200,000 Able’s annual sinking fund requirement on the guaranteed debentures is P40,000 per year. What amount should Able report as current maturities of long-term debt in its December 31, 2021 balance sheet?ABC Corporation was able to issue 20-year P10,000,000-face value bonds with interest of 8% per annum, due every quarter. It incurred issuance cost of P350,000 but it got net proceeds of P10,200,000 from the issuance. The annual effective cost of these bonds is closest toSepia Inc. issued $350,000 bonds that were redeemable in 7 years. They established a sinking fund that was earning 5.50% compounded semi-annually to pay back the principal of the bonds on maturity. Deposits were being made into the fund at the end of every 6 months. a. Calculate the size of the periodic sinking fund deposits. b. Calculate the sinking fund balance at the end of the 4th payment period. c. Calculate the amount of interest earned during the 5th payment period. d. Calculate the amount by which the sinking fund increased in the 5th payment period.
- To raise $5,000,000 to expand into new markets, a very successful laptop manufacturing company issued bonds with a coupon rate of 4.50% compounded semi-annually, paying interest every 6 months, and redeemable in 17 years. They established a sinking fund to retire this debt on maturity and made equal deposits into the fund at the end of every 6 months. a. If the fund was earning 3.75% compounded semi-annually, calculate the periodic cost of the debt. b. Calculate the book value of the debt at the end of 11 years.ICU Window, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with nine years to maturity that is quoted at 117 percent of face value. The issue makes semiannual payments and has an embedded cost of 11 percent annually. What is the company’s pretax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Pretax cost of debt % If the tax rate is 34 percent, what is the aftertax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Aftertax cost of debt %A UM issued 54 bonds of ₱1,500 face value each, redeemable at par at the end of 15 years. To accumulate the funds required for redemption, the firm established a sinking fund consisting of annual deposits, the interest rate of the fund being 5%. What was the principal in the fund at the end of the 10th year? a. 47,213.95b. 56,979.67c. 34,537.09d. 75,976.75