Question: If a company with a high debt to equity ratio
If a company with a high debt to equity ratio wants to increase its debt when the economy is weak, what kind of bond might it issue?
Answer to relevant QuestionsWhat determines whether bonds are issued at a discount, premium, or face value?How does a lender assess the risk that a borrower may default—that is, not pay interest and principal when due?Noble Corporation has outstanding $400,000 of 8 percent bonds callable at 104. On December 1, immediately after the payment of the semiannual interest and the amortization of the bond discount were recorded, the unamortized ...Norris Corporation issued $2,000,000 in 10.5 percent, 10-year bonds on February 1, 2014, at 104. Semiannual interest payment dates are January 31 and July 31. Use the straight-line method and ignore year-end accruals.1. With ...Fleetwood Corporation sold $800,000 of 12 percent, 10-year bonds at face value on September 1, 2014. The issue date of the bonds was May 1, 2014.1. Prepare the journal entries to record the sale of the bonds on September 1 ...
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