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Meep
Lv 4
Meep asked in Business & FinanceInvesting · 8 years ago

Finance - Questions about Bonds?

Please help! I have a final exam and I am going through the review and I don't know how to calculate these two (I have the answer).

1. On January 1,2003 Sawyer Company issued $100,000 of its 10 years bonds payable to generate cash for expansion. The bonds will retired in 10 years and have a stated rate of 5%. Interest will be paid annually each December 31 starting December 31, 2002.

If Sawyer issued the bonds to yield an effective (market) rate of 4%, what amount of cash would Sawyer receive at issue? (Answer: $108,115)

2. XYZ Corporation reported net income of 8,000. It has 100 shares outstanding of 8%, $100 par value preferred stock. Also, there are 1,000 shares of $10 par value common stock issued and 950 shares outstanding. What are the earnings per share of common stock?

Please, I need serious answers. If you have no idea, please don't answer. Also, I'm allowed to use a financial calculator.

1 Answer

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  • 8 years ago
    Favorite Answer

    Hi Meep, how are you?

    It looks like this is a homework assignment question that you've typed as your question. Could you please provide your answers / calculations to the question and then allow the users here to comment on your answer / calculation, so that we can check your work? I think that you'll learn a lot more by this process than having someone do your homework for you.

    P.S.: You may also find the following "Open Homework Help Questions" section on Yahoo Answers to be of great help: http://answers.yahoo.com/dir/index?sid=396545134

    Hope that helps!! Cheers!!

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