Answer:
D) Service Revenue
Explanation:
From the question we are informed about the Robert Rogers, CPA who performed accounting services for a client in December. A bill was mailed to client on December 30. Roberts received a check in the mail on January 5. The revenue principle would require that which of the following accounts appear on the income statement for the year ended December 31 is Service revenue.
Service revenue can be regarded as
the income that is been generated by a company through the service they provide. This amount can be seen on the top of the company's income statement, and there is addition of this amount to the revenue gotten from
product earnings so that total revenue of company can be calculated for a specific period of time.
Miller Corporation has a premium bond making semiannual payments. The bond has a coupon rate of 8 percent, a YTM of 6 percent, and 18 years to maturity. The Modigliani Company has a discount bond making semiannual payments. This bond has a coupon rate of 6 percent, a YTM of 8 percent, and also has 18 years to maturity. Both bonds have a par value of $1,000.
Required:
a. What is the price of each bond today?
b. If interest rates remain unchanged, what do you expect the price of these bonds to be 1 year from now? In 9 years? In 13 years? In 17 years? In 18 years?
Answer:
The function/formula for PV is PV(Rate,Nper,PMT,FV) where Rate = YTM, Nper = Period, PMT = Coupon Payment and FV = Face Value of Bonds.
a. Miller Bond
Here, Rate = 6%/2 = 3%, Nper = 18*2 = 36, PMT = 1,000*8%*1/2 = $40 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(3%,36,40,1000)
Bond Price = $1,218.32
Modigliani Bond
Here, Rate = 8%/2 = 4%, Nper = 18*2 = 36, PMT = 1,000*6%*1/2 = 30 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(4%,36,30,1000)
Bond Price = $810.92
b. 1 Year from Now
Miller Bond
Here, Rate = 6%/2 = 3%, Nper = 18*2 = 34, PMT = 1,000*8%*1/2 = $40 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(3%,34,40,1000)
Bond Price = $1,211.32
Modigliani Bond
Here, Rate = 8%/2 = 4%, Nper = 17*2 = 34, PMT = 1,000*6%*1/2 = 30 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(4%,34,30,1000)
Bond Price = $815.89
9 Years from Now
Miller Bond
Here, Rate = 6%/2 = 3%, Nper = 9*2 = 18, PMT = 1,000*8%*1/2 = $40 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(3%,18,40,1000)
Bond Price = $1,137.54
Modigliani Bond
Here, Rate = 8%/2 = 4%, Nper = 9*2 = 18, PMT = 1,000*6%*1/2 = 30 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(4%,18,30,1000)
Bond Price = $873.41
13 Years from Now
Miller Bond
Here, Rate = 6%/2 = 3%, Nper = 5*2 = 10, PMT = 1,000*8%*1/2 = $40 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(3%,10,40,1000)
Bond Price = $1,085.30
Modigliani Bond
Here, Rate = 8%/2 = 4%, Nper = 5*2 = 10, PMT = 1,000*6%*1/2 = 30 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(4%,10,30,1000)
Bond Price = $918.89
17 Years from Now
Miller Bond
Here, Rate = 6%/2 = 3%, Nper = 1*2 = 2, PMT = 1,000*8%*1/2 = $40 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(3%,2,40,1000)
Bond Price = $1,019.13
Modigliani Bond
Here, Rate = 8%/2 = 4%, Nper = 1*2 = 2, PMT = 1,000*6%*1/2 = 30 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(4%,2,30,1000)
Bond Price = $981.14
18 Years
Miller Bond
Here, Rate = 6%/2 = 3%, Nper = 1*2 = 2, PMT = 1,000*8%*1/2 = $40 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(3%,0,40,1000)
Bond Price = $1,000
Modigliani Bond
Here, Rate = 8%/2 = 4%, Nper = 0, PMT = 1,000*6%*1/2 = 30 and FV = $1,000 [we use 2 since the bond is semi-annual]
Bond Price = PV(4%,0,30,1000)
Bond Price = $1,000
Will Mark as Brainliest!!! +40 extra points Spending money on medical expenses is part of this expenditures approach for calculating the GDP.
a. consumer spending
b. gross exports
c. sum of all the country's businesses spending on capital
d. sum of government spending
e. gross imports
Answer A
Explanation: