CMA Study Group

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  • 1.  Bond

    Posted 03-08-2020 06:42 AM
    Why the interest calculated on 8% not 6% as interest are calculated on coupon rate


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    Syed Yousuf Jamal

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  • 2.  RE: Bond

    Posted 03-09-2020 12:55 AM
    The question has not given the Bond Par Value. It just says the Issue Price. Now the Coupon Rate is 6% and Yield is 8%. It means the Bond is issued at Discount, so as to make the Interest amount equal to 8%. That is why the Interest expense is calculated as 8% and not 6%.



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  • 3.  RE: Bond

    Posted 03-12-2020 02:21 AM

    Inline image

    Kindly if anyone can explain this question 


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