On June 30, 2013, Gaston Corporation sold $800,000 of 11% face value bonds for $761,150.96. On December
Question:
On June 30, 2013, Gaston Corporation sold $800,000 of 11% face value bonds for $761,150.96. On December 31, 2013, Gaston sold $700,000 of this same bond issue for $734,645.28. The bonds were dated January 1, 2013, pay interest semiannually on each December 31 and June 30, and are due December 31, 2020.
Required:
Compute the effective yield rate on each issuance of Gaston's 11% bonds.
CorporationA Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...
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June 30 2013 issuance The effective annual interest rate is 12 found by trial and error ...View the full answer
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Related Book For 
Intermediate Accounting Reporting and Analysis
ISBN: 978-1111822361
1st edition
Authors: James M. Wahlen, Jefferson P. Jones, Donald Pagach
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