Assume a bond is issued at 102.5 on March 1 to yeild an effective interest rate of 9.2%. How do I prepare the entry in journal form for March 1, September 1, and November 30? Someone please help me with this question as soon as possible. Thanks
2006-12-01 13:36:04 · 1 answers · asked by annalicious 1 in Business & Finance ➔ Other - Business & Finance
You can't answer the question unless you have the following further three details:
1) What's the principle of the bond? $100,000?
2) What are the terms of the coupon? There is clearly a coupon on the bond since it is issued a premium and still has a 9.2% effective interst rate (otherwise it would be issued at a discount). Also, is it paid semi-annual as is typical for corporate bonds, annually or quarterly?
3) How long is the bond? 5-years? 10-years? You can calculcate this if you know the first two, but it would make it a lot easier if you gave this detail.
2006-12-03 21:42:52 · answer #1 · answered by csanda 6 · 0⤊ 0⤋