Part 1:
What is the market value of each of the following bond issues?
Bond A Bond B Bond C
Coupon 10% 12% 8%
Face value $500,000 $ 1,000,000 $ 650,000
Life (years) 10 15 20
Interest payable (times per year): 2 4 12
Effective rate: 10% 8% 10%
Market Value =
Show Calculations Below :
Part 2:
2. On May 1, Lenny Corporation purchased for $700,000 a tract of land on which a warehouse and office building were located. The following data were collected concering the property:
Current Assessed Valuation Vendor’s Original Cost
Land $250,000 $ 185,000
Warehouse 330,000 312,000
Office Building 225,000 144,000
$805,000 $ 641,000
Determine the appropriate amounts that Lenny should record for the land, warehouse, and office building. A journal entry is not needed.
