This is Financial question, form chaapter 7, The Valuation and Characteristics o

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This is Financial question, form chaapter 7, The Valuation and Characteristics of Bonds. I need the steps, not only answer, thank you!1

1. which of the following $1000 face value bonds has a 10% yield, assuming semiannual coupon payment of 8%

A. A 5year maturity bond selling for 964.54

b. A 10 year maturity bond selling for 875.39

C. A 20 year maturity bond selling for 828.36

2. Spiess Corporation's 12%, $1000 bonds mature in 10years. The company can call the bonds in five years if it pays bondholders a call premium of 12 percent. What should Spiess's bonds sell for if investors expect them to be called in five years and the interest rate is 9%?

A. 1195.96 B. 840.45 C. 2120 D.1194.68

3. Joshua Trucking leased a set of special-use trailers for six years at an annual rental of $30,000, payable at the end of each year. at the end of these six years the trailers are expected to be essentially worthless. Joshua Trucking's cost of balance sheet as a result of leasing this equipment?

A. Add $40,000 to the Leased Trailers and Lease Obligations account.

B. Add $40,000 to the Leased Traukers account and $134578 to the Lease Obligations account.

C. Add $134578 to the Leased Trailers and Lease Obligations account

D. Make no change in the balance sheet accounts.

4. Match the following

____1. Secured Bonds

____2. Debentures

____3. Subordinated

____4. Convertible Bonds

A. Bonds that are backed by the value of specific assets

B. Bonds that are not backed by the value of specific assets

C. Bonds haveing a "junior" position relative to more "senior" debt

D. Bonds that permit their holders to share in the appreciation of the company's stock.

Explanation / Answer

1.b. A 10 year maturity bond selling for 875.39

2. C. Add $134578 to the Leased Trailers and Lease Obligations account

3.     1-c

         2-a

        3-d

        4-b

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