On January 1. current year, Jump Co. issued B-year bonds with a face value of...

50.1K

Verified Solution

Question

Accounting

image
image
On January 1. current year, Jump Co. issued B-year bonds with a face value of $ 680,000 and a stated interest rate of 8% payable semiannually on July 1 and January 1, starting from July 1 of current year. The market rate was 10%. Present value table factors are: Present value of 1 for 8 periods at 8% 0.54027 Present value of 1 for 8 periods at 10% 0.46651 Present value of 1 for 16 periods at 4% 0.53391 Present value of 1 for 16 periods at 5% 0.45811 Present value of an ordinary annuity of 1 for 8 periods at 8% 5.74664 Present value of an ordinary annuity of 1 for 8 periods at 10% 5.33493 Present value of an ordinary annuity of 1 for 16 periods at 4% 11.65230 Present value of an ordinary annuity of 1 for 16 periods at 5% 10.83777 Calculate the issue price of the bonds. The equation needed to complete the work is given below. Fill out the four missing amounts to complete the work. Specifically, enter the amount of principal in box (1), enter the factor that should be used for the present value of principal in box (2), enter the periodic interest amount in box (3), and enter the factor that should be used to calculate the present value of interest in box (4). Price of bonds= Present value of Principal + Present value of Interest ( Principal * Factor) + (Periodic Interest Factor) (1) ? (2) ? (3) ? (4)? Le consente given below. Fill out the four missing amounts to complete the work specially enter the amount of principal in box (1) enter the factor that should be used for the present value of principal in box (2), enter the periodic interest amount in box (3) and enter the factor that should be used to calculate the present value of interest in box (4). Price of bonds Present value of Principal + Present value of interest (Principal. Factor) (Periodic Interest Factor) (1) ? (2) ? (3) ? Answer: (1): A/ (2) / (3): A

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students