Question
On January 1, 2012, PT Berdikari purchased bonds (maturity date January 1, 2017) which issued by PT Angkasa at a fair value of Rp. 9
On January 1, 2012, PT Berdikari purchased bonds (maturity date January 1, 2017) which issued by PT Angkasa at a fair value of Rp. 9 billion. The face value of the bonds is 10 billion with a nominal interest rate of 7% which is paid every 31 December. Based on calculations accountant of PT Berdikari, the effective interest rate obtained from the investment in the bonds is 9.25%.
Step by Step Solution
3.40 Rating (150 Votes )
There are 3 Steps involved in it
Step: 1
To calculate the effective interest rate for an investment in bonds you can use the following formul...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Intermediate Accounting
Authors: kieso, weygandt and warfield.
14th Edition
9780470587232, 470587288, 470587237, 978-0470587287
