answers to bond exam

Name____________________________________time__________________
1-4: 30million of 4% 20 year bonds dated 8/1/2009 are issued 10/1/2009 at100. Give the first 4 J/E's

date accts dr cr
1
2
3
4

5-8: 50million of 3% 10 year bonds are dated and issued 9/1/2009 at 98. Give the first 4 J/E's
date accts dr cr
5
6
7
8

9 give the carrying value for the bond in 5-8 @ 12/31/12


10 Give the carry value at 12/31/2015 for 70million of 12% 10 year bonds are dated and issued 3/1/2009 at 102.





01-Oct dr cash 30200000
cr int pay 200000
cr bp 30000000
--------------------------------------
123109 dr int exp 300000
cr int pay 300000
-----------------------------------------
01/31/10 dr int exp 100000
dr int pay 500000
cr cash 600000
--------------------------------------------
07/31/10 dr int 600000
cr cash 600000
=================================================
=============================================================



09/01/09 cash dr 49000000
dr discount 1000000
cr bp 50000000
---------------------------------------
1231/09 dr int exp 533333.3333
cr discount 33333.33333
cr int payable 500000
--------------------------------------------
01-Mar dr int exp 266666.6667
cr int payable 500000
cr discount 16666.66667
cash 750000
----------------------------------------------
01-Sep dr int exp 800000
cr discount 50000
cr cash 750000

=========================================
------------------------------------------------------
per mo 8333.333333
mo 40 36+4
333333.3333

face 50000000
initial disc 1000000
amortized 333333.3333
49,333,333.33
-----------------------------------------------------
per mo 11666.66667
mo 82 72+10
956666.6667

face 70000000
initial premium 1400000
amortized 956666.6667
70,443,333.33