Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help solve. Note Valuation. Western Corporation reported the following information on its long-term debt in its 2019 annual report (in millions): Face Value Face

Please help solve.

image text in transcribed
Note Valuation. Western Corporation reported the following information on its long-term debt in its 2019 annual report (in millions): Face Value Face Value Stated Effective (In millions, except interest rates) June 30, 2019 June 30, 2018 Interest Rate Interest Rate Notes November 3, 2018 50 $1,750 1.30% 1.40% December 6, 2018 . 0 1,250 1.63% 1.82% June 1, 2019. . . . 1,000 4.20% 4.38% August 8, 2019 . . . . 2,500 2,500 1.10% 1.20% November 1, 2019 18 18 0.50% 0.50% February 6, 2020 .... . . . 1,500 1,500 1.85% 1.95% February 12, 2020 . . . 1,500 1,500 1.85% 1.94% October 1, 2020 . . . . 1,000 1,000 3.00% 3.14% November 3, 2020 2,25 2,25 2.00% 2.09% February 8, 2021 . . . 500 500 4.00% 4.08% August 8, 2021 . . . . . . 2,750 2,750 1.55% 1.64% December 6, 2021 (a) 1,994 2,044 2.13% 2.23% February 6, 2022 1,750 1,750 2.40% 2.52% February 12, 2022 . . 1,500 1,500 2.38% 2.47% November 3, 2022 . 1,000 1,000 2.65% 2.72% November 15, 2022 750 750 2.13% 2.24% May 1, 2023 . . . 1,000 1,000 2.38% 2.47% August 8, 2023 . .. . . 1,500 1,500 2.00% 2.10% December 15, 2023 1,500 1,500 3.63% 3.73% February 6, 2024 2,250 2,250 2.88% 3.04% February 12, 2025 2,250 2,250 2.70% 2.77% November 3, 2025 3,000 3,000 3.13% 3.18% August 8, 2026 . . . 4,00 4,000 2.40% 2.46% February 6, 2027 . .. .. 4.000 4,000 3.30% 3.38% December 6, 2028 (a) . . . . 1.993 2,044 3.13% 3.22% May 2, 2033 (@) . . . 626 642 2.63% 2.69% February 12, 2035 1,500 1,500 3.50% 3.60% November 3, 2035 1,000 1,000 4.20% 4.26% August 8, 2036 .. . . 2,250 2,250 3.45% 3.51% February 6, 2037 2,500 2,500 4.10% 4.15% June 1, 2039. . . . 750 750 5.20% 5.24% October 1, 2040 . 1,000 1,000 4.50% 4.57% February 8, 2041 . . 1,000 1.000 5.30% 5.36% November 15, 2042 900 900 3.50% 3.57% May 1, 2043 . ..... . 500 500 3.75% 3.83% December 15, 2043 . . .. 500 500 4.88% 4.92% February 12, 2045 . 1,750 1,750 3.75% 3.80% November 3, 2045 3,00 3,000 4.45% 4.49% August 8, 2046 . .. 4,500 4,50 3.70% 3.74% February 6, 2047 . 3,00 3,000 4.25% 4.29% February 12, 2055 2,250 2,250 4.00% 4.06% November 3, 2055 1,000 1,000 4.75% 4.78% August 8, 2056 . . . . . . 2,250 2.250 3.95% 4.03% February 6, 2057 2.000 2,000 4.50% 4.53% Total . . . $72,781 $76,898 (a) Euro-denominated debt securities. 1. Are the May 1, 2023 notes recorded at a discount or a premium? Why? 2. Assume Moody's reports that the October 1, 2020 notes were rated as Aaa. a. If the rating had been Aal instead, would the yield rate on the notes have been lower, higher, or the same? b. If the notes had been secured, would the yield rate have been lower, higher, or the same

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Susan S. Hamlen

3rd Edition

1618531514, 978-1618531513

More Books

Students also viewed these Accounting questions

Question

=+b) What would you recommend doing next to help improve the model?

Answered: 1 week ago

Question

1. Why do we trust one type of information more than another?

Answered: 1 week ago