5. Consider a 4-year zero-coupon bond priced such that its YTM is 7% per year. Assume the face value is $1000.

a. Determine the dollar price of the bond. (Enter the dollar price of the bond, such as 876.25 (without the dollar sign)). Do not enter the 32^nd conventional equivalent price.

b. Now assume that one year later interest rates have fallen and now the bond has a YTM of 5% (down from 7% one year earlier). What is the dollar price of the bond now?
HINT: The price is not equal to $822.70.

c. If you purchased the bond for price computed in Part A and sold it one year later for the price computed in Part B, then what is the holding period yield? i.e. what is the holding period yield from t = 0 to t = 1?
Enter your answer as a decimal, not as a percent.

d. With only one year remaining on the bond (i.e. at t = 3), the YTM on the bond is 10%. Compute the annualized effective holding period yield assuming you hold the bond from t = 1 (when it was, as described in Part B) to t = 3. Notice that this rate spans the two-year period from t = 1 to t = 3 but should be expressed as an effective annual value (in decimal form).

Enter the effective annualized holding period yield as a decimal, not as a percent, with at least 4 digits of precision.

A 30-year variable-rate mortgage offers a first-year teaser rate of 2%. After that, the rate starts at 4.5%, adjusted based on actual interest rates. The maximum rate over the life of the loan is 10.5%, and the rate can increase by no more than 200 basis points a year. If the mortgage is for $250,000, what is the monthly payment during the first year? Second year? What is the maximum payment during the fourth year? What is the maximum payment ever?

On January 1, Year 2017, Kennard Co. issued $2,000,000, 5%, 10-year bonds, with interest payable on June 30 and December 31 when the market rate of interest for similar bonds was 6%. Use the following format and round figures to nearest dollar.

1. Actual proceeds received from the issuance of the bonds

2. Prepare an amortization schedule for Year 1 and Year 2 using the effective interest rate method.

Date    Cash Paid    Interest Expense Amortization    Bond Carry Value

3. Show how this bond would be reported on the balance sheet at December 31, Year 2.

Baltimore Manufacturing Company just completed its year ended December 31, 2019. Depreciation for the year amounted to $300,000: 25% relates to sales, 20% relates to administrative facilities, and the remainder relates to the factory. Of the total units produced during FY 2019: 65% were sold in 2019 and the rest remained in finished good inventory. Use this information to determine the dollar amount of the total depreciation that will be contained in Cost of Goods Sold.  (Round dollar values & enter as whole dollars only.)

Great Wall Pizzeria issued 18-year bonds one year ago at a coupon rate of 5.1 percent. If the YTM on these bonds is 8.6 percent, what is the current bond price? Note: Corporate bonds pay coupons twice a year. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Suppose we observe the three-year Treasury security rate (₁R₃) to be 4.6 percent, the expected one-year rate next year—E(₂r₁)—to be 5.2 percent, and the expected one-year rate the following year—E(₃r₁)—to be 6.2 percent. If the unbiased expectations theory of the term structure of interest rates holds, what is the one-year Treasury security rate?(Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

1. Carla earns $100,000 per year now, and pays $20,000 per year on her fixed rate mortgage. Her income is subject to a COLA clause. If the risk-free rate of interest is 3%, and the expected inflation rate is 2% per year, what is the spending power of her net income in 10 years, expressed in today’s dollars?

2. How would you find the present value of 10 years of Carla’s income without being given an inflation rate or interest rate? HINT: Use market data to determine your answer.

A 65-year-old woman presents with a 10-year history of osteoarthritis,
primarily affecting her hips and knees and new complaints
of neuropathic pain due to type 2 diabetes that may have been
poorly controlled in the past. She has frequent complaints of joint
pain after walking or other activities and experiences stiffness in
the morning when she awakens or after sitting during bridge games.
Recently, she has had difficulty walking and has had several near
falls. She states that her feet feel heavy, numb, and tingling. The
pain feels like pins and needles. She displays no apparent distress,
but this is common in chronic pain. Because the pain is affecting
her active lifestyle, therapy is indicated to improve functional status.
Options for chronic nonmalignant pain include nonsteroidal
anti-inflammatory drugs (NSAIDs), opioids (preferably long-acting
forms), corticosteroids, and local anesthetics. Because the onset of
neuropathic pain is recent, appropriate therapy with antidepressants,
anticonvulsants, or lidocaine may be appropriate. After initiation
of an individualized regimen, the patient should be assessed for
adequacy of pain relief and the presence of side effects.

1) Summarize the Problem or Concern

2) Provide a brief Patho discussion on your primary diagnosis/problem/concern

3) Provide a Pharmacological Plan to treat your patient

4) Provide patient educational information specific to your pharmacological plan

Entries for Installment Note Transactions

On January 1, Year 1, Bryson Company obtained a $19,000, four-year, 11% installment note from Campbell Bank. The note requires annual payments of $6,124, beginning on December 31, Year 1.

a. Prepare an amortization table for this installment note, similar to the one presented in Exhibit 4.

Note: Round the computation of the interest expense to the nearest whole dollar. Enter all amounts as positive numbers. In Year 4, round the amount in the Decrease in Notes Payable column either up or down to ensure that the Carrying Amount zeroes out.

b. Journalize the entries for the issuance of the note and the four annual note payments.

Note: For a compound transaction, if an amount box does not require an entry, leave it blank. For the Year 4 entry (due to rounding), adjust Notes Payable up or down to ensure that debits equal credits.

c. How will the annual note payment be reported in the Year 1 income statement?
of $ would be reported on the income statement.

2). XYZZ Company leased equipment from RRR Company on July 1, year x1, for an eight-year period expiring June 30, year x9. Equal annual payments under the lease are $200,000 and are due on July 1 of each year. The first payment was made on July 1, x1. The rate of interest contemplated by Trump and Reagan is 8%. The cash selling price of the equipment is $1,241,250 and the cost of the equipment on Reagan's accounting records was $1,100,000. Assuming that the lease is appropriately recorded as “sales-type” by Reagan, what is the amount of gross profit on the sale and the interest income that Reagan would record for the year ended December 31, x1? No tables are needed. Select one: a. $0 and $0. b. $141,250 and $49,650. c. $141,250 and $41,650. d. $0 and $41,650.