Bright Sun, Inc. sold an issue of 30-year $1,000 par value bonds to the public. Thebonds had a 7.61 percent coupon rate and paid interest annually. It is now 12 yearslater. The current market rate of interest on the Bright Sun bonds is 11.08 percent.What is the current market price (intrinsic value) of the bonds?Round the answer to two decimal places.

Bonds payable is a type of instrument where by an amount is borrowed for a fixed period with fixed…

Answered: Bright Sun, Inc. sold an issue of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

Rick Barr Properties has two bonds outstanding. Bond A was issued 15 years ago with a coupon rate of 8%. The other, Bond B, was issued 12 years ago with a coupon rate of 8%. Both bonds were originally issued as 30-year bonds with coupon payments made semi-annually. The current market rate (YTM) is 11%? What is the current price of Bond A? What is the current price of Bond B?
Nikita Enterprises has bonds on the market making annual payments, with 17 years to maturity, a par value of $1,000, and selling for $969. At this price, the bonds yield 8.1 percent. What must the coupon rate be on the bonds? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
Nikita Enterprises has bonds on the market making annual payments, with eight years to maturity, a par value of $1,000, and selling for $962. At this price, the bonds yield 5.1 percent. What must the coupon rate be on the bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Coupon rate
Last year, Sam Morris purchased a $1000 Dynamic Electronics corporate bond with an annual interest rate of 6.5%. The bond's current market price is $900. Calculate the following. If necessary, round all answers to two decimal places. If necessary, refer to the list of financial formulas. 1. Annual interest: 2. Current yield:
Nikita Enterprises has bonds on the market making annual payments, with eleven years to maturity, a par value of $ 1,000, and selling for $982. At this price, the bonds yield 7.6 percent. What must the coupon rate be on the bonds? ( Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g 32.16.)
Springfield Nuclear Energy Inc. bonds are currently trading at$900.29. The bonds have a face value of $1,000, a coupon rate of3.5% with coupons paid annually, and they mature in 20 years. What is the yield to maturity of the bonds? The yield to maturity of the bonds is__________% (Round to two decimal places.)
Nikita Enterprises has bonds on the market making annual payments, with eight years to maturity, a par value of $1,000, and selling for $962. At this price, the bonds yield 5.1 percent. What must the coupon rate be on the bonds? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Coupon rate %
Nikita Enterprises has bonds on the market making annual payments, with 17 years to maturity, a par value of $1,000, and selling for $956. At this price, the bonds yield 9.1 percent. What must the coupon rate be on the bonds? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Answer is complete but not entirely correct. Coupon rate 8.69 %
Last year, Kevin Thomas purchased a $1000 Campbell Manufacturing corporate bond with an annual interest rate of 7.25%. The bond's current market price is $770. Calculate the following. If necessary, round all answers to two decimal places. If necessary, refer to the list of financial formulas. 1. Annual interest: 2. Current yield: $0 0% X S
The Photo Film Company’s bonds have fouryears remaining to maturity. Interest is paid annually,the bonds have a $1,000 par value, and the couponinterest rate is 8.75%.(a) What is the yield to maturity at a current marketprice of $1,108?(b) Would you pay $935 for one of these bonds ifyou thought that the market rate of interest was9.5%?
You issued debt in the form of bonds, with a face value of $1,000, and have 12 years until maturity. The bonds have an annual coupon rate of 8.4%, which are paid semiannually. a. The current price is $1,115. What is the pretax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 12.34.) b. The tax rate is 25%. What is the aftertax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 12.34.) a. Pretax cost of debt b. Aftertax cost fo debt % %
(Related to Checkpoint 9.2) (Yield to maturity) Abner Corporation's bonds mature in 23 years and pay 9 percent interest annually. If you purchase the bonds for $1,200, what is your yield to maturity? Your yield to maturity on the Abner bonds is%. (Round to two decimal places.)

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