o attnet paamweb%2F No results Options search ce Homework Bingham Company issues

Question

o attnet paamweb%2F No results Options search ce Homework Bingham Company issues bonds with a par value of $620.000 on their stated issue date. The bonds mature in 8 years and pay 0% annual interest in semiannual payments. On the issue date, the annual market rate for the bonds is 12%, dat e B.3, and Table B.4) (Use appropriste factorls) from the tables provided.) ilable 2 las 1. What is the amount of each semiannual interest payment for these bonds? 2. How many semiannual Interest payments will be made on these bonds over their life? 3. Use the interest rates given to select whether the bonds are issued at par, at a discour 4. Compute the price of the bonds as of their issue date. S. Prepare the journal entry to record the bonds issuance or at a premium. Complete this question by entering your answers in the tabs below. Rea i to 3 Reg 4 Req 5 What is the amount of each semiannual interest payment for these bonds? How many semlianeaal interest payments will be made on these bonds over their ife? Use the interest rates given to select whether the bonds are issued at per, at a diescount, or at a premiam prt

Explanation / Answer

1.) Amount of semi annual interest payments ($620,000 * 0.10 * 1/2) = $31,000

2.) Number of semi annual interest payments: ( 8 * 2 ) = 16 payments

3.) The bonds are issued at par or discount or premium : The bonds were issued at a premium ie., when the market rate of return 12% is more than the coupon rate 10%.

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