Question 5:
At what amounts should these two notes receivable be reported in
Jet's December 31, 2005, balance sheet?
Question 6:
What should be the issue price for each $1,000 bond?
Question 7:
What should be the total interest revenue earned by King on this note?
Question 8:
A loan is granted in the amount of $500,000 with a stated interest rate
of 10%. The lender incurs direct loan
origination costs of $10,000 and charges the borrower a 3-point
nonrefundable fee. The effective interest rate
to the lender will be
Question 9:
On November 1, year 1, a company purchased a new machine that it
does not have to pay for until November
1, year 3. The total payment on November 1, year 3, will include both
principal and interest. Assuming
interest at a 10% rate, the cost of the machine would be the total
payment multiplied by what time value of
money concept?
Question 10:
Theoretically, the proceeds from the sale of a bond will be equal to