On January 1, Landan, Inc. issued a 20-year semiannual bond with a face value of $915,000...

On January 1, Landan, Inc. issued a 20-year semiannual bond with a face value of $915,000 paying 8%. On the date of issue, the market rate for similar bonds was 8%. Landan would like to know how much this issuance would raise.

The following table is a SCRATCH table and will NOT be graded. You may use it, if you wish, to assist you. Provided you answer the other questions correctly, you could leave it blank and still receive full credit.

TVM Data Table

What is the value of the ordinary annuity factor, AO() that is used in this problem?

What is the value of the discount factor, DF(), that is used in this problem?

How much does Landan raise from this issue? . You may ignore transaction costs.

NEED ANSWER IN 20 TIMED QUIZ

Solutions

Expert Solution

Colby Messinger answered 1 year ago

Next > < Previous

Related Solutions

On January 1 of this year, Ikuta Company issued a bond with a face value of...

On January 1 of this year, Ikuta Company issued a bond with a face value of $145,000 and a coupon rate of 7 percent. The bond matures in 3 years and pays interest every December 31. When the bond was issued, the annual market rate of interest was 8 percent. Ikuta uses the effective-interest amortization method. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use the appropriate factor(s) from the tables provided. Round your final...

On January 1, 2019, Plywood Homes, Inc., issued 20-year, 4% bonds having a face value of...

On January 1, 2019, Plywood Homes, Inc., issued 20-year, 4% bonds having a face value of $1 million. The interest on the bonds is payable semiannually on June 30 and December 31. The proceeds to the company were $975,000 (i.e. on the day they were issued the bonds had a market value of $975,000). On June 30, 2019, the company’s fiscal closing date, when the bonds were being traded at 98.5, each of the following amounts was suggested as a...

On January 1, 2008, Shelly Corp. issued $8,000,000 face value 20-year bonds at 101. Bond issuance...

On January 1, 2008, Shelly Corp. issued $8,000,000 face value 20-year bonds at 101. Bond issuance costs total $40,000. The bonds pay interest semi-annually on Jan 1 and Dec 1. Shelly uses straight-line amortization. On Jan 1, 2016, Shelly calls the entire issue at 103 and cancels it. Required: Prepare the journal entry for this bond redemption on Jan 1, 2016. Please show all work

BYL Inc. issued a 20-year floating rate bond with face value of $1,000. The coupon payments...

BYL Inc. issued a 20-year floating rate bond with face value of $1,000. The coupon payments of the floater are calculated based on the basis of the coupon formula of 180-day LIBOR+150 basis points. The floor and cap of the floater are 3.5 percent and 7 percent respectively. Compute the coupon rate and coupon payments for the floater under the following LIBOR rates: 1%, 1.50%. 2%, 2.25%, 3%, 4.75%, 5%, 5.25%, 5.50%, 5.75%, and 6%.

BYL Inc. issued a 20-year floating rate bond with face value of $1,000. The coupon payments...

On January 1, 2016, Plywood Homes, Inc., issued 20‐year, 4 percent bonds having a face value...

On January 1, 2016, Plywood Homes, Inc., issued 20‐year, 4 percent bonds having a face value of $1 million. The interest on the bonds is payable semiannually on June 30 and December 31. The proceeds to the company were $975,000 (i.e., on the day they were issued the bonds had a market value of $975,000). On June 30, 2016, the company’s fiscal closing date, when the bonds were being traded at 98 ½, each of the following amounts was suggested...

on January 1, 2013, Johnson corporation issued a 10 year, 6% bond with a face value...

on January 1, 2013, Johnson corporation issued a 10 year, 6% bond with a face value of $2,175,000. The bonds were sold to yield 5%. Interest is payable semi-annually on January 1 and July 1. Effective ammortization is to be used. What accounts related to this bond would be shown on the 12/31/13 balance sheet? show in the proper sections. Current Liabilities: Long-term Liabilities:

Alenza, Inc. plans to issue a 10-year semiannual bond with a face value of $990,000 with...

Alenza, Inc. plans to issue a 10-year semiannual bond with a face value of $990,000 with a coupon rate of 4%. On the date of issue, it expects the market rate for similar bonds will be 6%. Under these conditions, Alenza would like to know how much this issuance would raise. What framework will you use to solve this problem? Cost-Volume-Profit (CVP) Counting - Permutation or Combination Time Value of Money (TVM) Binomial Probability - B(n, p) Normal or Standard...

Faber-Overdrive Autoparts issued at par value a 15-year 6% semiannual coupon bond, face value $1,000. At...

Faber-Overdrive Autoparts issued at par value a 15-year 6% semiannual coupon bond, face value $1,000. At the end of 2 years, the market yield increased to 7%. One year later, the market yield was 8%. If you purchased the bond at the end of Year 2 and sold it one year later, how much was your capital gain or loss?

January 1, 2018: Nexxon corporation issued 20 year, 9% bonds with a face value of $2,000,0000....

January 1, 2018: Nexxon corporation issued 20 year, 9% bonds with a face value of $2,000,0000. the bonds were sold to yield 10%. Interest is payable semi-annually on january 1 and July 1. Effective rate amortization is to be used. 1. what is the issue price of the bonds? 2. Using EXCEL, prepare an amortization table for the entire bond term. 3. Record the bond issuance on 1/1/18 4. assume the company prepares financial statements semi-annually on June 30 and...

Subjects