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Determine the price of the bonds at january

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Question - On January 1, 2016, Instaform, Inc., issued 10% bonds with a face amount of $50 million, dated January 1. The bonds mature in 2035 (20 years). The market yield for bonds of similar risk and maturity is 12%. Interest is paid semiannually. (FV of $1,PV of $1,FVA of $1,PVA of $1,FVAD of $1andPVAD of $1)

1. Determine the price of the bonds at January 1, 2016.

2. Prepare the journal entry to record their issuance by Instaform?

3. Assume the market rate was 9%. Determine the price of the bonds at January 1, 2016.

4. Prepare the journal entry to record their issuance by Instaform.

Reference no: EM132051097

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