The note about debt included with the financial statements of FDL Company for th
ID: 2531474 • Letter: T
Question
The note about debt included with the financial statements of FDL Company for the year ended December 31, 2017 disclosed the following:
The above table summarizes the long-term debt of the Company at December 31, 2017. All of the notes were originally issued at their face(maturity) value and have been gradually repain over time so that these amounts are the remaining balances at this date.
Assume that the notes pay interest annually and mature on December 31 of the respective years.
Suppose that FDL wants to pay off the 7.85% notes on December 31, 2018, (i.e., five years early) when the going interest rate is 9%, thereby retiring the $346,200,000 in debt. How much would FDL have to pay for the notes (principal only) on this date in order to satisfy the noteholders?
7.35% notes due 2018 $202,400,000 7.85% notes due 2023 $346,200,000 8.10% notes due 2032 $227,000,000 7.73% notes due 2030 $202,000,000 6.65% notes due 2019 $25,200,000Explanation / Answer
FDL have to pay for the notes (principal only) on this date in order to satisfy the noteholders?
Going Interest=346200000*9% $31,158,000
Particulars Face value Interest Rate Interest 7.35% notes due 2018 $202,400,000 7.35% $14,876,400 7.85% notes due 2023 $346,200,000 7.85 $2,717,670,000 8.10% notes due 2032 $227,000,000 8.10% $18,387,000 7.73% notes due 2030 $202,000,000 7.73% $15,614,600 6.65% notes due 2019 $25,200,000 6.65% $1,675,800 Total Interest Payable 2018 $2,768,223,800 Suppose that FDL wants to pay off the 7.85% notes on December 31, 2018, (i.e., five years early) when the going interest rate is 9%, thereby retiring the $346,200,000 in debt.FDL have to pay for the notes (principal only) on this date in order to satisfy the noteholders?
7.35% notes due 2018 $202,400,000 7.85% notes due 2023 $346,200,000Related Questions
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