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aunch.ispcouea 43825 18&course; id97798 1&tcontantid; 3524694 ustep nu ¥ Question Completion status. QUESTION 11 1 polnts Save Answer On Jariuary 1, 2014, enbok Coripany issued bords wilh a ae value of S50,000 The bods malure i livg years, arid pay inleaally al a slaled rale of 10%. Since the market rate at the time of the issue was 12%, the bonds were sod at discount, the actual issue price was $46.395 On January 1, 2017, Benbrook decides to redeem the bonds payable st the specified redemption price of 101 What is he carrying value of the honds on the redemption date? a $46,395 .$46,962 $4B,310 e non. of the bove QUESTION 12 1 polnts Save Answer Refer lo the inforrnation above for Beribrook Corporation How much gain or loss i with the company recognize on t the bond redemption? A s0 S5DD oss c. S1, 190 loss d $3,005 loss non of Ihe above QUESTION 13 1 points Save Answor Click Save and Subi LO Suve and subrnit. Click Suve Ali Amswers o save l answers Save All Answers Save and Submit ^ 4x 11/11/2017

Explanation / Answer

Value of bond at redemption

1 PV factor ==+(1-(1+0.12)^-4)/0.12=3.03735

2 PV factor =1/(1+0.12)^4 =.63552

2

Answer is none of the above

Loss =46962.65-50000*1.01=-3537.35

Cash inflow PV factor Present Value 5000 3.03735 15186.75 50000 0.63552 31775.90 Value of Bond at redemtion 46962.65

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