bonds is selling at $1,132, with 15 years to maturity; it makes an annual coupon payment at 8%. 5 years after the issue, the market interest rate declined and the corporation decided to call the bond at $1,080. The face value of the bond is $1,000. What is the Yield to Call on the bonds

Answers

Answer 1

Answer:

6.26%

Explanation:

The yield to call is the rate of return earned by bondholders over the 5-year period before the bonds were called.

It can be determined using excel rate function as well as financial calculator as shown thus:

=rate(nper,pmt,-pv,fv)

nper=the period between bond issuance and the call in years=5

pmt=annual coupon=face value*coupon rate=$1000*8%=80

pv=the initial purchase price=-1132

fv=the price at which the bonds were called after 5 years=1080

=rate(5,80,-1132,1080)=6.26%

Financial calculator:

N=5

PMT=80

PV=-1132

FV=1080

CPT I/Y=6.26%


Related Questions

Rodgers Company gathered the following reconciling information in preparing its May bank reconciliation. Calculate the adjusted cash balance per books on May 31.
Cash balance per books, May 31 $3,457
Deposits in transit 131
Notes receivable and interest collected by bank 853
Bank charge for check printing 47
Outstanding checks 1,567
NSF check 180
a. $3,816.
b. $2,730.
c. $1,195.
d. $1,979.

Answers

Answer:

$4,083

Explanation:

Preparation of the Adjusted Cash Balance per Books on May 31

Adjusted Cash Balance per Books on May 31

Cash Balance per Books on May 31 $3,457

Add Notes Receivable and Interest Collected by Bank $853

Less Bank Charge for Check Printing ($47)

Less NSF Check ($180)

Adjusted Cash Balance per Books on May 31 $4,083

Therefore the Adjusted Cash Balance per Books on May 31 will be $4,083

Which of the following statements accurately describes the free enterprise
system in the United States?

Answers

Answer:

The statement which accurately describes the free enterprise system in the United States is:

A market system.

Explanation:

The free enterprise system or capitalist system is a free market system where the government does not restrict much of the business activities or property ownership of its citizens. The main features of a free enterprise system are citizens can own private property, supply and demand (or market forces) drive productive activities, consumers and producers are free to make their own economic decisions, and the citizens can freely accumulate wealth.  These features expand on the four great principles of a free enterprise system, which are: private property rights, profit motive, equal individual rights, and unrestricted competition.

The possible choices are ; production cost report, total manufacturing cost per unit, equivalent units of production, units transfered out, unit production costs, cost reconciliation schedule, total units accounted for, and physical units.
Match the following statements to the appropriate terms.
A summary of both production quantity and cost data for a production department.
Shows that the total costs accounted for equal the total costs to be accounted for.
Work done during a period expressed in fully completed units.
Costs expressed in terms of equivalent units of production.
Actual units to be accounted for during a period, irrespective of any work performed.
Units transferred out during the period plus units in ending work in process.
Unit materials costs plus unit conversion costs.
Total units accounted for minus units in ending work in process.

Answers

Answer:

           Statement                                                  Appropriate terms

A summary of both production                       Production cost report

quantity  and cost data for a  

production department.  

Shows that the total costs accounted           Cost reconciliation schedule

for  equal the total costs to be

accounted for.

Work done during a period expressed         Equivalent units of production

in fully completed units.

Costs expressed in terms of equivalent        Unit production costs

units of production.

Actual units to be accounted for during        Physical units

a period, irrespective of any work

performed.

Units transferred out during the period        Total units accounted for

plus units in ending work in process.

Unit materials costs plus unit                        Total manufacturing cost

conversion costs.                                            per unit

Total units accounted for minus units           Units transferred out

in ending work in process.

Why are short sentences and short paragraphs appropriate for business communication?

Answers

Answer:

Objs. 4 For business communications it is essential to express ideas and facts eloquently. The shorter the sentences and paragraph are, the brief the letter, memo or notice. This will save the reader's and writer's time.

Other Questions
A school is arranging a field trip to the zoo. The school spends 688.95 dollars on passes for 42 students and 3 teachers. The school also spends 391.02 dollars on lunch for just the students. How much money was spent on a pass and lunch for each student? how many dollars was spent per students Help Please 8 points and Brainliest if correct!!! 246000 in scientific notation why is the nucleus an important part of most cells Which graph represents a function? The length of a rectangle is 2x + 3. The width of the rectangle is x - 2. Which of the following represents the perimeter of the rectangle? How do I do this problem (similar right triangles) please explain how you did it!! ASAP!!! 2. Where was Bertha Mason from?JamaicaOEnglandGermanyCuba(Jane eyre) What is cos(47)=x/3 solve for x Why did the king establish the dominion of New England in the American colonies.A. the king felt the colonies were growing too independent from England.B. The king wanted the colonies to have more control over their government.C. The king believed New England needed greater protection from New France.D. the king was concerned that New York and New Jersey had lost their charters. Rodgers Company gathered the following reconciling information in preparing its May bank reconciliation. Calculate the adjusted cash balance per books on May 31. Cash balance per books, May 31 $3,457 Deposits in transit 131 Notes receivable and interest collected by bank 853 Bank charge for check printing 47 Outstanding checks 1,567 NSF check 180a. $3,816.b. $2,730.c. $1,195.d. $1,979. Which equation represents a line with a slope of 12 passing throughthe point (6, 4)? please answer ASAP. will give brainiest with explanation Why are short sentences and short paragraphs appropriate for business communication? Help me I need an answer The Brunswick librarian and Jupiters foster mother say, He has to love her for her, too (Chapter 7). What are they talking about and what does that mean? The book is Orbiting JupiterDon't answer unless you know or I report you where were atomic bombs dropped during ww2 Find the value of x help asap What organlle does cellular respritation take place in Invasive species are destructive to an ecosystem because they____________(Select best answer). disrupt food chainstake or destroy ecological nichesout compete native species for limited resourcesall of the above A 5 kilogram block is dropped from a height of 3 meters and falls straight to the ground. What is the work done by the force of gravity?