BE14-19 (similar to) Questi For each of the following scenarios, compute the acc

Question

BE14-19 (similar to) Questi For each of the following scenarios, compute the accrued interest and cash received when the bond is issued. EEB (Click the icon to view the scenarios.) (Round all amounts to the nearest whole dollar.) Scenarios Face value Stated interest rate Interest payments Interest payment date Issue date Bond issue proceeds Accrued interest Cash received S 852,400 $ 262,800 $ 651,400 $ 354000 5% Quarterly June 30 May 1 August 31 S 863,600 $ 197,400$ 623,900 $357,900 6% Semiannually July 1 September 30 896 Quarterly Semiannually March 31 January 1 6% Scenario Face value Stated interest rate Interest payments Interest payment date Issue date Bond issue proceeds Accrued interest Cash received S 852,400 $ 262,800 S 651,400 354,000 5% Semiannually Quarterly Semiannualy Quarterly June 30 May 1 August 31 $ 863,600 $ 97,400 $ 623,900 $ 357,900 6% 6% 8% May 1 July 1 September 30 yMarch 31 January 1 May 1 Print Done

Explanation / Answer

Scenario 1: Acc interest = 852400 x 6% x 3 / 12 = $ 12786

Cash Received = 863600 + 12786 = $ 876386

Scenario 2: Accrued Interest = $ 1314

Cash received = $ 198714

Scenario 3: Accrued Interest = $ 17371

Cash received = $ 641271

Scenario 4: Accrued Interest = $ 17700

cash received = $ 375600

Please let know if the amounts are not correct, I will make sure you get the correct answer. Thanks

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