Question: On January 1 2013 Brandon Electronics issued 85 million of
On January 1, 2013, Brandon Electronics issued $85 million of 11.5% bonds, dated January 1. The market yield for bonds of maturity issued by similar firms in terms of riskiness is 12.25%. How can Brandon sell debt paying only 11.5% in a 12.25% market?
Relevant QuestionsWhen Patey Pontoons issued 6% bonds on January 1, 2013, with a face amount of $600,000, the market yield for bonds of similar risk and maturity was 7%. The bonds mature December 31, 2016 (4 years). Interest is paid ...On January 1, 2013, Madison Products issued $40 million of 6%, 10-year convertible bonds at a net price of $40.8 million. Madison recently issued similar, but nonconvertible, bonds at 99 (that is, 99% of face amount). The ...At January 1, 2013, NCI Industries, Inc., was indebted to First Federal Bank under a $240,000, 10% unsecured note. The note was signed January 1, 2009, and was due December 31, 2014. Annual interest was last paid on December ...At January 1, 2013, Brant Cargo acquired equipment by issuing a five-year, $150,000 (payable at maturity), 4% note. The market rate of interest for notes of similar risk is 10%.Required:1. Prepare the journal entry for Brant ...The 2010 annual report of the Sonic Corporation reported minimum lease payments receivable of $1,982,000 and a net investment in direct financing leases of $1,486,000. What accounts for the difference between these two ...
Post your question