Interest Expense: Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization. Carrying value: Carrying value is referred to an asset’s original cost. From that any depreciation , amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset. Unrealized Gain: An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization. Requirement 1 To calculate: Net Interest Income needs to be calculated for June 30 and December 31 , 2013 .

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Answer 1

Question

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

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D&R A3 1-2 Question 1. Plain Vanilla Interest Rate Swap Incredible Inc., a manufacturer of children’s toys, enters into a two-year plain vanilla interest rate swap, in which the corporation will receive a fixed rate and pay a floating rate of LIBOR. The notional amount on this swap is $75 million. Swap payments will be netted every 180 days, and the LIBOR requires the assumption of a 360-day year. The term structure of LIBOR on the swap initiation date is as follows: Days Rate (%) 180 3.50 360 3.55 540 3.60 720 3.70 Calculate the swap value on the initiation date.

Answer 2

Question

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

Expert Solution & Answer

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Answer 3

Question

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

Answer 6

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

Answer 7

Chapter 9.M, Problem 3E

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 1

To calculate:

Net Interest Income needs to be calculated for June 30 and December 31, 2013 .

Answer 8

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

Answer 9

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 2

To calculate:

Carrying Value needs to be calculated for June 30 and December 31, 2013 .

Answer 10

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

Answer 11

To determine

Concept Introduction:

Interest Expense:

Interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a very crucial role for any organization.

Carrying value:

Carrying value is referred to an asset’s original cost. From that any depreciation, amortization and asset impairment costs are subtracted in order to ascertain the carrying value of the asset.

Unrealized Gain:

An unrealized gain is basically realized when the prices of the stock are usually higher than the original price. Unrealized profit is advantageous for any organization.

Requirement 3

To calculate:

Net Realized gain or Loss on Swap needs to be calculated for June 30 and December 31, 2013.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 9.M - Prob. 1UTI Ch. 9.M - Prob. 2UTI Ch. 9.M - Prob. 3UTI Ch. 9.M - Prob. 4UTI Ch. 9.M - Prob. 5UTI Ch. 9.M - Prob. 1E Ch. 9.M - Prob. 2E Ch. 9.M - Prob. 3E Ch. 9.M - Prob. 4.1E Ch. 9.M - Prob. 4.2E

Solution Summary: The author explains that interest Expense is any type of interest that is incurred debt like loans, bond etc. Interest factor plays a crucial role for any organization.

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Chapter 9 Solutions