Home
Search results “Discount and premium bonds”
Discounts, Premiums and Bonds at Par (Intermediate Financial Accounting Tutorial #12)
 
06:42
Before we moved onto valuing and reporting long term bonds I thought that I would provide a quick summary of bonds issued at a discount, premium or at par. The stated rate is also known as the coupon rate, or face rate. The market rate is also known as the effective rate and is the rate at which you can get other very similar or identical financial instruments (for example, a bond may have been issued at a 4% coupon rate, 1 year later the market rate for those bonds might have shifted to 6%). Website: http://www.notepirate.com Follow us on Facebook: https://www.facebook.com/pages/Note-Pirate/514933148520001?ref=hl Follow us on Twitter: https://twitter.com/notepirate We appreciate all of the support you guys have given us. Be apart of the mission to help us reach more students by subscribing, thumbs upping and adding the videos to your favorites! ** Notepirate is privately owned and exclusive to Notepirate.com.**
Views: 35037 Notepirate
Bond Discount or Premium?
 
05:10
Bond discount and premium calculation basics and the resulting after tax costs. Get more answers at our forum for finance and accounting at passingscoreforum.com
Views: 9937 Passing Score
Amortizing a Bond Premium
 
15:25
This video explains how to account for bonds issued at a premium. An example is provided to illustrate how to calculate the bond proceeds, premium, interest expense, amortization of the bond premium, and the carrying value of the bonds. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 68902 Edspira
Explanation: Bond Discounts
 
02:39
This video will help you understand why companies issue bonds at a discount. We will not go over any calculations in this video.
Views: 3573 Accounting Videos
How to Amortize a Bond Discount
 
19:17
This video explains how to account for bonds issued at a discount using the effective interest rate method for bond discount amortization. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 111169 Edspira
Bond Issue at Discount and Premium(Straight Line) | Intermediate Accounting | CPA Exam FAR |Chp14 p3
 
20:58
Bond valuation, bond interest expense, par value, amortization, straight line method, effective interest rate method, bond discount, bond premium, carrying value of bond, premium, discount, bond issue between interest dates, CPA exam
Bond Issued At Discount Versus Premium How To Calculate And Amortize The Bond
 
08:18
Understand the dfference between a bond purchased (issued) at a discount versus a bond purchased (issued) at a premium, bond has two cash flows, (1) face value or principal amount paid at maturity and (2) interest payment (usually semi annual) based on the stated rate of interest on the bond, example shown as a cash flow diagram, present value (PV) what its worth when issued (issue date) based on discounting bonds cash flows (maturity value + interest payments) back to issue date using the market rate of interest, comparing the bonds present value to its future value (face value) determines whether the bond is purchased (issued) at a discount or premium amount, for a discount (bonds PV is less than on the bonds face value) while for a premium(amount the PV is greater than its face value), detailed example comparing amortization schedules for bond discount versus bond premium, details cash interest payments (stated rate of interest x bond face value), interest expense (market rate x carrying value of bond outstanding debt), amortized interest expense (interest payment - interest expense),subtract amortized premium to the bonds carrying value to determine the bonds new carrying value (bond amortization),
Views: 34670 Allen Mursau
What is a Premium/Discount?
 
01:46
Welcome to the Investors Trading Academy talking glossary of financial terms and events. Our word of the day is “Premium/Discount”. A premium or discount represents the percentage difference between the previous closing market price of an exchange-traded fund, exchange-traded note or closed-end fund and that security's net asset value called an NAV. The security trades at a premium when the NAV of the security is below its previous close and is represented by a positive number. The security trades at a discount when the NAV of the security is above its previous close and is represented by a negative number. In short, if the price of the electronically traded fund also called an ETF is trading above its NAV, the ETF is said to be trading at a “premium.” Conversely, if the price of the ETF is trading below its NAV, the ETF is said to be trading at a “discount.” In relatively calm markets, ETF prices and NAV generally stay close. However, when financial markets become more volatile, ETFs quickly reflect changes in market sentiment, while NAV may take longer to adjust—resulting in premiums and discounts. This can happen throughout the trading day, because the ETF and its underlying securities are actually two distinct liquidity pools that are only loosely linked. If optimistic investors start bidding up an ETF aggressively—more so than its underlying securities—the price of the ETF may rise faster than the price of its underlying securities and, consequently, may trade at a premium. By Barry Norman, Investors Trading Academy
Bonds Effective Interest Method - Discount
 
16:41
This video explains how to calculate a bond that sells at a discount. It shows the corresponding journal entries on the original sale and interest payments. It also shows how to prepare the amortization table and explains what the numbers represent.
Views: 28177 mattfisher64
Bond Terminology
 
09:24
Bonds are typically heavily tested on the FAR section of the CPA Exam. So, in the 11.01 - Bond Terminology video, Roger Philipp, CPA, CGMA, begins to lay the groundwork for understanding bonds by providing definitions of some key terms and concepts. It’s important to demystify and understand all the terms that may show up about bonds on the CPA Exam. Some bond questions that Roger answers in the video are, "Why are some bonds issued at a premium? Are bonds debt or equity? Why are some bonds issued at a discount? How does the relationship between the bond yield and the bond coupon rate affect whether the bond is issued at a discount or premium?" It's important to remember that market rate is the same as yield is the same as effective rate, and that the stated rate is the same as coupon rate is the same as face rate is the same as nominal rate. Also, carrying value equals book value equals reported amount. The basic formula for carrying amount is face value plus or minus unamortized bond discount or bond premium. Don't understand term bonds, serial bonds, debenture bonds? No to worry, Roger explains it all in the video. By the end of this lesson, you will be ready to go into some numbers-heavy Bond Issuance Examples. Connect with us: Website: https://www.rogercpareview.com Blog: https://www.rogercpareview.com/blog Facebook: https://www.facebook.com/RogerCPAReview Twitter: https://twitter.com/rogercpareview LinkedIn: https://www.linkedin.com/company/roger-cpa-review Are you accounting faculty looking for FREE CPA Exam resources in the classroom? Visit our Professor Resource Center: https://www.rogercpareview.com/professor-resource-center/ Video Transcript Sneak Peek: Welcome, welcome. Today we're going to talk about bonds and present value techniques because it's important to understand the concept of present value. A bond is a very important area, very heavily tested and there's a whole bunch of different new ones, is a big word for me that relates to bonds. What is a bond? A bond is a borrowing agreement whereby the issuer of the bond promises to pay you, the purchaser of the bond, a certain amount of money after a certain period of time at a certain interest rate. That is what the purchaser of the bond or the issuer rather of the bond is promising to give to the purchaser.
Views: 23952 Roger CPA Review
Discount and Premium Amortization on Bonds
 
09:58
http://www.accounting101.org An example problem on discount and premium amortization on bonds.
Views: 18451 SuperfastCPA
What is a Bond? Calculation of a Discount Bond.
 
08:11
What is a bond, including the calculation of how to value a discount bond. An understanding of the Time Value of Money is necessary. For more questions, problem sets, and additional content please see: www.Harpett.com. Video by Chase DeHan, Assistant Professor of Finance at the University of South Carolina Upstate.
Views: 2338 Harpett
Bond Issuance Examples
 
09:40
Roger Philipp, CPA, CGMA, presents a basic bond issue with a face value of $1 million, term of 5 years, and stated or coupon rate of 8% in the video 11.01 - Bond Issuance Examples. He also shows the journal entries for issuance and interest payments at market rates or effective rates of 8%, then 10%, and then 6%. If the bond is issued to yield 8%, then the bond is issued at par and interest expense will equal the interest payment. If the effective interest rate is 10% then the bond is issued at a discount. Now interest expense will no longer equal the cash coupon interest paid. Roger explains how to set up the journal entry, keeping things simple for now with straight-line amortization of the bond discount. Roger continues the problem by showing in the journal entry how the issuer’s interest expense will equal the market rate of 10%. Finally, Roger walks through the journal entries for this 8% face rate bond issued at a premium with a yield of 6%. As an advanced bonus, Roger has us consider the effects of the bond interest payments on the statement of cash flows. Connect with us: Website: https://www.rogercpareview.com Blog: https://www.rogercpareview.com/blog Facebook: https://www.facebook.com/RogerCPAReview Twitter: https://twitter.com/rogercpareview LinkedIn: https://www.linkedin.com/company/roger-cpa-review Are you accounting faculty looking for FREE CPA Exam resources in the classroom? Visit our Professor Resource Center: https://www.rogercpareview.com/professor-resource-center/ Video Transcript Sneak Peek: Now, next page it says issuance of bonds example and we're going to go through this example. Face value of the bonds, million dollars. Term, five year versus what? Term versus serial bond which matures in installments. Stated interest rate 8%. That's how much cash I'm going to get. I'm going to get 8% of a million dollars or $80,000 in cash but what am I earning? That's a different question. Then it says effective or market or yield is eight in example A, ten in example B, six in example C. Notice that we're going to be doing three examples. One is going to be eight, eight which is issued at par, issued at face. We don't have to worry about the discounted premium then we'll go to a discount example, then we'll go to a premium example and then life will be beautiful for you, things will make sense.
Views: 27865 Roger CPA Review
Relationship between bond prices and interest rates | Finance & Capital Markets | Khan Academy
 
13:16
Why bond prices move inversely to changes in interest rate. Created by Sal Khan. Watch the next lesson: https://www.khanacademy.org/economics-finance-domain/core-finance/stock-and-bonds/bonds-tutorial/v/treasury-bond-prices-and-yields?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/stock-and-bonds/bonds-tutorial/v/introduction-to-the-yield-curve?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Finance and capital markets on Khan Academy: Both corporations and governments can borrow money by selling bonds. This tutorial explains how this works and how bond prices relate to interest rates. In general, understanding this not only helps you with your own investing, but gives you a lens on the entire global economy. About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content. For free. For everyone. Forever. #YouCanLearnAnything Subscribe to Khan Academy’s Finance and Capital Markets channel: https://www.youtube.com/channel/UCQ1Rt02HirUvBK2D2-ZO_2g?sub_confirmation=1 Subscribe to Khan Academy: https://www.youtube.com/subscription_center?add_user=khanacademy
Views: 552917 Khan Academy
How to Calculate the Issue Price of a Bond (Semiannual Interest Payments)
 
04:46
This video shows how to calculate the issue price of a bond that pays semiannual interest. The issue price is the sum of: (1) the present value of the face value of the bond, which is to be paid when the bond matures, and (2) the present value of the interest payments. Because the bond pays interest semiannually, the interest rate should be divided by two and the number of periods should be adjusted (e.g., if it is a 10-year bond, there would be 20 periods because interest is paid twice a year). The video provide formulas to calculate the present values and illustrates the computations using an example. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like Edspira on Facebook, visit https://www.facebook.com/Edspira To sign up for the newsletter, visit http://Edspira.com/register-for-newsletter Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin To follow Michael on Facebook, visit https://www.facebook.com/Prof.Michael.McLaughlin
Views: 27627 Edspira
Bond Issued At Premium Or Discount Deterimed By Bonds Present Value Of Cash Flows
 
07:55
How to calculate the bond premium or bond discount based on the present value of a bond (issued) for both a bond issued at a discount and a bond issued at a premium, bond has two cash flows, (1) face value or principal amount paid at maturity and (2) interest payment (usually semi annual annuity type payments) based on the stated rate of interest on the bond, example shown as a cash flow diagram, present value (PV) what its worth when issued (issue date) based on discounting bonds cash flows (maturity value + interest payments) back to issue date using the market rate of interest, comparing the bonds present value to its future value (face value) determines the discount or premium amount on the bond, both cases (bond premium versus bond discount) are demonstrated and calculated based on a cash flow diagram which includes the bonds future value (face value, maturity value) and interest payment amounts, using Excel present value function the cash flows are discounted back using the market rate of interest to determine a discount or premium amount on the bond (discount PV is less than face value while premium PV greater than face value of bond), must determine bond discount or premium for amortization of the bond used in accounting, detailed example by Allen Mursau
Views: 9887 Allen Mursau
Bonds Effective Interest Premium Amortization
 
12:59
This video goes through the calculation of a bond premium and then prepares a spreadsheet showing the amortization of the premium. Finally it shows the corresponding journal entries. To see all my video links, look at my playlists at my channel: mattfisher64.
Views: 9546 mattfisher64
discount and premium bonds
 
00:20
gustavo c and fransico trujilo
Views: 405 EzStizi Gaming
Bonds Straight Line Amortization
 
07:01
This video shows how we use the straight line amortization method to record interest expense for both a discount and a premium.
Views: 30913 mattfisher64
Bond Issue at Premium/Discount(Effective Int. Rate)| Intermediate Accounting |CPA Exam FAR|Chp 14 p4
 
34:51
Bond valuation, bond pricing, bond interest expense, par value, amortization, straight line method, effective interest rate method, bond discount, bond premium, carrying value of bond, premium, discount, bond issue between interest dates, CPA EXAM
Excel Finance Class 52: Bond Discount Or Premium Amortization Table.
 
06:59
Download Excel workbook http://people.highline.edu/mgirvin/ExcelIsFun.htm Learn how to create a Bond Discount or Premium Amortization Table. See how a Discounted Bond Actually Increases Interest and a Premium Reduces Interest.
Views: 17591 ExcelIsFun
Excel Finance Class 51: Par - Discount - Premium Bonds
 
09:51
Download Excel workbook http://people.highline.edu/mgirvin/ExcelIsFun.htm Learn about how Bonds can be sold at Par, Discount or Premium. See how to Create an IF Function formula to indicate whether the Bond is sold at a Discount, Premium or Par.
Views: 7327 ExcelIsFun
How to Determine the Carrying Value of Bonds
 
09:33
This video shows how to calculate the carrying value of a bond throughout the life of the bond. The initial carrying value is the issue price of the bond. This carrying value is then adjusted each period (adjusted upward if the bond was issued at a discount, downward if the bond was issued at a premium). Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like Edspira on Facebook, visit https://www.facebook.com/Edspira To sign up for the newsletter, visit http://Edspira.com/register-for-newsletter Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin To follow Michael on Facebook, visit https://www.facebook.com/Prof.Michael.McLaughlin
Views: 7296 Edspira
Bond Amortization Schedule Effective Interest Rate Method Accounting (Bond Discount)
 
07:51
How to amortize a bond issued at a discount (present value less than face value of bond) using the effective interest rate method, bond has two cash flows, (1) face value or principal amount paid at maturity and (2) interest payment (usually semi annual) based on the stated rate of interest on the bond, example shown as a cash flow diagram, present value (PV) what its worth when issued (issue date) based on discounting bonds cash flows (maturity value + interest payments) back to issue date using the market rate of interest, comparing the bonds present value to its future value (face value) determines the discount amount on the bond (amount the PV is less than its face value), the discount amount has to be amortized over the life of the bond using an amortization schedule, detailed example showing how to setup amortization schedule and use the schedule to amortize the bond discount, detailed calculations with accounting journal entries (T accounts)on balance sheet template for bond payable, discount on bond payable, interest payments, interest expense (market rate x carrying value of bond), amortized interest expense (interest payment - interest expense), add amortized discount to the bonds carrying value to determine the bonds new carrying value (bond amortization), detailed calculations and accounting by Allen Mursau
Views: 51942 Allen Mursau
Bond Retirement
 
03:40
In the video, 11.04 - Bond Retirement, Roger Philipp, CPA, CGMA, sets up the journal entry to retire a bond by first reviewing the initial issuance journal entry, then turning it around into a bond retirement journal entry. He discusses, Debit Bonds Payable, debit any unamortized premium or credit any unamortized discount, credit any unamortized bond issue costs and credit Cash for the amount paid to retire the bond. Please note that the plug will be the gain or loss. If the plug is a debit, it’s a loss on bond retirement; if the plug is a credit, it’s a gain on bond retirement. Roger also briefly covers bond sinking funds in this lesson. In the next lesson, it will be time to apply all this bond knowledge to working through questions! Website: https://www.rogercpareview.com Blog: https://www.rogercpareview.com/blog Facebook: https://www.facebook.com/RogerCPAReview Twitter: https://twitter.com/rogercpareview LinkedIn: https://www.linkedin.com/company/roger-cpa-review Are you accounting faculty looking for FREE CPA Exam resources in the classroom? Visit our Professor Resource Center: https://www.rogercpareview.com/professor-resource-center/ Video Transcript Sneak Peek: All right, let's talk about bond retirement. So, we've talked about issuing a bond. And, remember issuing a bond. Credit bonds payable, accrued interest, cash, boom, boom. This is BIC, this is discount or premium. Now, early retirement of bonds. So what this says is, the bond may be called, it may be retired prior to once it matures. In other words, it's a five year bond, but two years in, they call it back. Basically, it's the opposite of the entry we just did. So, as we look through this, it's the opposite of the journal entry.
Views: 12989 Roger CPA Review
Governmental Accounting (Bond Issued At Premium Vs Discount, Serial Vs Term Bonds, J/E's, Etc.)
 
23:59
Governmental Accounting Bonds Issued at Premium Versus Discount & Serial Versus Term Bonds, Governmental Funds account & Accounting Control Group account for recording the (A) Bond Issued (thru Capital projects Fund), Debt Service Fund & General Long-Term Debt Account Group, (B) Inter-fund entries for Bond Premium, (C) Semi-annual Interest & Principal Payments, Discount Amt. Has No Effect On General Long-Term Debt Account Group, Capital Projects Fund (Accts. for Resources used in construction), Debt Service Fund (Accumulates $ To Pay Debt), General Long-Term Debt Account Group Accts. for (Unmatured Principal of Obligation (Debt)), detailed accounting by Allen Mursau
Views: 664 Allen Mursau
Bonds - Coupon and Market Rates Differ
 
03:13
Lesson discussing how the value of a bond changes when coupon rates and market rates differ. Looks at why a bond will trade at a premium, discount, or at par For more questions, problem sets, and additional content please see: www.Harpett.com. Video by Chase DeHan, Assistant Professor of Finance at the University of South Carolina Upstate.
Views: 3946 Harpett
ProfessorBDoug's Bond Premium Journal Entry
 
02:55
Short walk-through on creating a journal entry for bond premium at issuance and on semi-annual interest payment.
Views: 10187 ProfessorBDoug
Bonds: Par Value, Premium, Discount | Financial Accounting | CPA Exam FAR | Chp 14 p 2
 
53:25
bond indenture, Bonds payable, covenants, Long-term notes payable, Secured, Unsecured bonds, Term, Serial, and Callable bonds, Convertible, Commodity-Backed, Deep-Discount bonds, Registered bonds, Bearer bonds, coupon bonds, Income, Revenue bonds. Bond valuation, bond pricing, bond interest expense, par value, amortization, straight line method, effective interest rate method, bond discount, bond premium, carrying value of bond, premium, discount, bond issue between interest dates, CPA EXAM
13 -- Bonds Premiums and Discounts / Straight-Line Amortization
 
08:51
An overview of bond premiums and discounts under the straight-line amortization method, to accompany http://www.principlesofaccounting.com Chapter 13, Long-Term Obligations. *Check out the Classroom page to find out how to take this course for credit: http://www.principlesofaccounting.com/classroom.html
Views: 13808 Larry Walther
What Is A Discount On A Bond?
 
00:45
A bond that is issued for less than its par (or face) value, or a currently trading value in the secondary market. You'll also learn the advantages and deep discount bonds (ddb's) are in form of zero interest. What is discount bond? Definition and meaning investor words. When a business sells bond at discount, it must record discount balance in 3 nov 2012 is either that was originally sold less than its face value, or which now trades price below value (or both) definition of the financial dictionary by free online english and encyclopedia. Discount bond definition in the cambridge english dictionarybond valuation wikipedia. As with any security or capital hence, the value of a bond is obtained by discounting bond's expected cash flows to present using an appropriate discount rate. This is caused by the bonds having a definition of discount bond that sells at below its par value, instead paying interest like ordinary. Learn more a zero coupon bond is bought at price lower than its face value, with the value in united states, would have original issue discount (oid) for tax purposes. Issuing bonds at a discount or premium video & lesson what is the difference between deep bond and zero financial planning 101 vs. These bonds are sold at a discounted value and on maturity, face interest is paid to 25 nov 2010. Bond discount investopedia bond investopedia terms d discountbond. A discount bond does the opposite trading below value on bonds payable (or discount) occurs when are issued for less than their face or maturity amount. Asp url? Q webcache. Bonds issued at a discount boundlessdiscount bond financial definition of. In practice pure discount bond read the definition of and 8000 other financial investing terms in nasdaq glossary 8 nov 2015 this lesson, we'll define a discuss how bonds are issued at premium. A bond is considered a discount when it has lower interest rate than the current market rate, and consequently sold at price amount by which of its principal due maturity. Bond discount investopediabond investopedia. Premium vs discount bonds (definition and explanation). A premium bond trades above its issuance price par value. A zero coupon deep discount bond is a debt security with no (zero coupon) or substantially lower than current interest rates definition of which sold at price below its face value and returns maturityBond investopediabond investopedia. Pure discount bond definition nasdaq. 00 means that the bond is selling for 98. Googleusercontent search. Premium zero coupon deep discount bond oecd statistics. In most cases, discount bonds reduce the risk of 2 mar 2017 how to calculate bond rate. What is discount bond? Meaning of bond definition, meaning, what a sold before its payment date at price that lower than value, so investors. A bond discount is the difference between face value of a and price for which it sells issued at when sold less than its par. Instruments issued with oid generally impute bond valuation is the determ
Views: 151 new sparky
Bonds
 
09:54
This video discusses advantages and disadvantages of bonds compared to stock. It also describes issuing at par, at a discount and at a premium. Finally it discusses the contract rate ( also known as coupon, stated, or nominal rate) vs the market rate.
Views: 6689 mattfisher64
Intro to Financial Accounting: Bonds Issued at Discount & Premium; Stockholder's Equity
 
01:14:46
Introduction to Financial Accounting Professor Alexander Sannella Lecture 21 00:12 Review on Recording Bonds issued at discounts (verbal) 06:03 Recording Bonds Issued at a discount 06:58 Example 08:05 Recording Discounted bonds 17:52 Straight line - Amortization Table (discount) 19:36 Example 23:20 Recording Bonds Issued at a Premium 24:15 Example (verbal) 31:22 Journal Entry 34:25 Amortization Table (premium) example 36:05 Journal Entry Questions and Answers 39:46 Question 1 46:10 Question 2 52:07 Question 3 Learning Objective 4 56:06 Retirement of Bonds at Maturity + Journal Entry 56:56 Retirement before Maturity 59:36 Reasons for retiring bonds early 1:02:05 Example of retirement before maturity + Journal Entry Learning Objective 5 1:06:24 Balance Sheet Example Learning Objective 6 1:06:45 Debt Equity Ratio Chapter 13 Learning Objective 1 1:10:57 Stockholder's Equity (Definitions of Stock Terms) When the bond interest rate is greater than the market rate, the bonds are issued at a premium. The difference between the bonds payable and the cash received is recorded as a bond premium (an adjunct account). The premium is amoritzed over the life of the bond, reducing interest expense to the lower market rate. When the bond interest rate is less than the market rate, the bonds are issued at a discount. The difference between the bonds payable and the cash received is recorded as a bond discount (contra-liability). The discount is amortized over the life of the bond, increasing interest expense to the higher market rate. Bonds can be retired before maturity by an open market repurchase or a "call." Bonds can be called at par or a price above par (which is par plus a call premium). A company will retire bonds before maturity for a variety of reasons: (1) To refinance in order to take advantage of lower market interest rates, (2) the company has excess cash and would like to avoid future interest changes and create greater financial flexibility, (3) to improve the company's debt to equity ratio, and (4) to comply with other debt agreements. When retiring before maturity, the full bonds payable will typically be retired. The remaining discount or premium will be removed. The cash paid will not equal the face value. The difference will be recorded as either a gain on retirement of bonds (cash paid to retire is less than the carrying value) or a loss on retirement of bonds (cash paid to retire is more than the carrying value). A corporation is a separate entity created by law that is separate and distinct from its owners and its continued existence is dependent upon the corporate statutes of the state in which it is incorporated. Classification by ownership distinguishes between publicly held and privately held corporations. The primary objectives for accounting for stock holder's equity are to: (1) separately disclose each source of equity (due to widespread ownership and the owner-manager separation), and (2) to disclose all rights or any restrictions of rights of each class of equity security. The stockholders' equity section of the balance sheet includes several parenthetical disclosures: the terms are: authorized shares, issued shares, and outstanding shares. Authorized shares is the maximum number of shares of stock that a company can issue. It is specified in the company's charter. Issued shares are the total number of a company's shares that have been sold or distributed to shareholders over time. Outstanding shares are the number of shares of a corporation's stock that are in the hands of investors. Outstanding shares are issued shares less treasury shares. Treasury shares are the number of issued shares that have been previously issued and later reacquired by the corporation. To receive additional updates regarding our library please subscribe to our mailing list using the following link: http://rbx.business.rutgers.edu/subscribe.html
What is a Bond and how do Bond Premiums and Discounts work?
 
06:41
What is a bond? How do bonds work? How do they behave as interest rates fluctuate? #Bonds #PersonalFinance #FinancialEducation
Views: 33 The Market is Open
Book Value vs Market Value vs Face Value of Bonds: How to Keep Them Straight
 
15:53
You’ll learn about the book value vs market value vs face value of bonds in this tutorial, and you’ll understand how to calculate and project them in financial models. https://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" Resources: https://youtube-breakingintowallstreet-com.s3.amazonaws.com/Book-Value-vs-Face-Value-Slides.pdf https://youtube-breakingintowallstreet-com.s3.amazonaws.com/Book-Value-vs-Face-Value.xlsx Table of Contents: 3:06 Excel Examples 11:04 Combined Example 14:46 Recap and Summary SHORT ANSWER: Face Value is the amount of Debt that a company issues, pays interest on, and must repay upon maturity. It is affected ONLY by Debt issuances, principal repayments, and Accrued or “Paid-in-Kind” (PIK) Interest. Book Value is the Debt that shows up on a company’s Balance Sheet under Liabilities & Equity, but it is NOT necessarily the amount it pays Interest on or what it must eventually repay. It’s affected by everything above (issuances, repayments, and accrued interest), plus Issuance Fees, any Discount or Premium when the bond is first issued, and the amortization of both those items. Market Value is what someone else would pay to buy the company’s Debt on the secondary market if it trades like that. It’s affected by interest payments, market interest rates on similar Debt, and future repayment upon maturity. In practice, the bond’s coupon rate vs market rates, as well as the credit default risk of the issuer, make the biggest impact. EXCEL EXAMPLES: Toro is spending a lot and must issue additional Debt to fund operations in several years. The Face Value of Debt goes up when new Debt is issued and down when there’s a repayment or maturity. The Book Value of Debt also changes based on these, but we also must deduct the 2% financing fee on new issuances and add the amortization of these financing fees over 10 years. We don’t know enough to determine the Market Value since it depends on current market rates vs the 6.1% coupon rate the company is currently paying. In another example, Atlassian has issued a Convertible Bond that matures in 5 years, if it’s not converted into Equity before then. Convertible Bonds are often separated into Equity and Debt components to reflect their dual nature, and the Book Value here equals the Face Value minus the Unamortized Issuance Fees minus the Debt Discount, which represents the difference in value between a traditional, non-convertible bond with a higher interest rate and the much-lower-rate convertible bond. The Face Value here never changes until the end because there are no additional issuances, there’s no accrued interest, and there’s only the single maturity at the very end. Cash Interest never changes since it’s always based on this constant Face Value and a constant interest rate. The Book Value keeps increasing as the Debt Discount is amortized over time and as the Issuance Fees are also amortized, but it finally reaches $0 at the same time as the Face Value. We don’t know enough to determine the Market Value, as we’d need to know the prevailing market interest rates on similar bonds and Atlassian’s default risk. ONE EXAMPLE TO RULE THEM ALL: Assume that a company issues a $1,000 10-year bond at a 5.00% coupon rate vs prevailing market rates of 6.35% on similar bonds. There are no principal repayments, and the interest is 100% Cash. There is a 2% issuance fee. Due to the below-market rate, the bond is issued at a $100 Discount. The Face Value is $1,000 initially, and it never changes until maturity. The Cash Interest is 5% * $1,000 = $50 per year until maturity. The initial Book Value is the $1,000 Face Value – $100 Discount – $20 Issuance Fee = $880. The Book Value will change according to the amortization of the Discount and the amortization of the Issuance Fees each year. Book Value, Year 1: $880 + $100 / 10 + $20 / 10 = $892 Book Value, Year 2: $892 + $100 / 10 + $20 / 10 = $904 The Market Value is initially the $1,000 Face Value minus the $100 Discount (verify with the PRICE function in Excel), so $900. We don’t know exactly how it will change over time because we don’t know future interest rates, but if rates go up, the Market Value will go down, and if credit default risk goes up, the Market Value will also go down (and vice versa for both of these). Does Book Value vs Market Value vs Face Value for Bonds Matter? In most cases, these distinctions don’t make a huge difference. If you’re under time pressure, you can simplify all this and include only Issuances and Repayments to project Debt. But interview questions on these topics could still come up, and if a company has a Convertible Bond or a normal bond issued at a big discount or premium, the Book Value vs Face Value distinction matters since interest is based on Face Value.
Bond Amortization (Straight Line Amortization Vs Effective Interest Method, Yield Rate Calculated)
 
12:18
Accounting for bond amortization comparing straight line amortization versus effective interest amortization method (amortization schedule calculated for each case), (1) straight line method amortizes the premium (or discount) evenly (beginning carrying value - maturity value)/number of periods amortized, (2) effective interest method amortizes the premium (or discount) based on the yield rate of the bond, in both cases compare the amortized amount to the cash payments to determine interest revenue recognized, the example includes calculating the effective interest rate, example Corp-A purchases 9% Stated IR on Bonds, $300,000 maturity value & Bonds mature in 3 years, pay interest semi-annually: 1-Purchase at 102 3/4 (102.75% of par), at premium, 2-Bonds Stated 9% IR is given but the Yield Rate is not given, 3-Must calculate the Yield (Effective) Interest Rate to amortize the Bonds using the Effective Interest Method, detailed calculations by Allen Mursau
Views: 13766 Allen Mursau
CFA Level I Non current liabilities (bonds) Video Lecture by Mr. Arif Irfanullah
 
38:38
This CFA Level I video covers concepts related to: • Long Term Liability • Bond and Bond Terminology • Market Rate vs. Coupon Rate • Bond Issued at Par • Bond Issued at Discount • Bond Issued at Premium • Cash Flow Treatment • Zero Coupon Bond • Issuance Cost • Amortization Methods • Recognition of Debt • Debt Covenants • Presentation and Disclosure of Long Term Debt For more updated CFA videos, Please visit www.arifirfanullah.com.
Views: 36823 IFT
Bond Valuation Basics - CA Final SFM (New Syllabus) Classes & Video Lectures
 
24:32
For More Visit our website - https://sfmguru.in/ Buy Rewamp & revise the entire SFM in 1 day: https://sfmguru.in/revamp-ca-final-sfm-revision-book/ Subscribe to Channel for more videos: https://www.youtube.com/channel/UCiPzkqrzDsoq-pLrloT7Fcw/featured Meaning of Bonds When a company has to raise long term debt, one of the modes of raising the funds is by issuing debentures. For all practical reasons, a debenture and a bond are one and the same. Bonds or debentures can be called financial Instruments which are contracts that give rise to a financial liability for one party (the one who issues such bonds) and a financial asset for the other party (the one who holds such bonds or debentures). Bond is a fixed income bearing security that provides interest at a definite rate to the investors. When an investor acquires a bond, he expects interest over the period and the redeemable value to be received at the maturity date or redemption date. In other word, after acquiring a bond, the investor receives a stream of cash flows. The total present value of such stream of cash flow (including the present value of redeemable value) is considered as the value of such bond. For the purpose of bond valuation the following terms must be clarified: 1. Face Value 2. Coupon Rate 3. Coupon payments 4. Issue Price 5. Market Price 6. Maturity Date 7. Redemption Price 8. Intrinsic Value 9. Callable & Puttable Bonds 10. Call Date & Call Price 11. Current Yield 12. Yield to Maturity (YTM) 13. Yield to Call (YTC) (For Callable Bonds) 14. Zero Coupon Bonds (ZCB) 15. Deep Discount Bonds (DDB) 16. Annuity Bonds 17. Bond STRIPS 18. Par Bonds, Premium Bonds and Discount Bonds 19. Convertible Bonds (OCDs & CCDs) 20. Straight Value of Convertible Bond 21. Stock Value of Convertible Bond 22. Conversion Parity Price 23. Conversion Premium 24. Clean Price & Dirty Price Issue Price of a bond is at which a new bond is priced by the issuer. Bonds can be issued at Par, Premium or Discount. Market Price of a bond indicates the price at which the bond can be bought or sold in the open market. What do you mean by Coupon Rate and Coupon Payments? Suppose a bond promises to pay interest at the rate of 8% per annum, then such rate is called “Coupon Rate”. The Coupon Rate is always applicable on the face value of the bond irrespective of its issue price or prevailing market price. For example, 9% Government of India Bonds provide half yearly interest on 30th June and 31st December. The face value of the bond is ` 1,000. The interest paid on each bond will be ` 1,000 x 9% x 6/12 = ` 45 on each of the interest payment dates. The interest payment of ` 45 during each of the months June and December are known as “Coupon Payments”. Coupon Rate is the rate of interest attached to the bond and it applies on the face value, for example, a 9% bond with face value of ` 1,000 will have interest payments of ` 1,000 x 9% = ` 90 every year. It should be noted that the interest on bonds can be payable quarterly, half yearly or annually in general. What is the Intrinsic Value of the Bond? Intrinsic value of the bond is the aggregate present value of all coupon payments and the redemption amount, determined by using a discounting rate which is expected rate of return by the investor. Maturity Date of a bond is the date at which a bond is redeemable or is due for redemption. A bond is generally redeemed at par or premium. Bond Valuation: Basic Principle As discussed earlier, the present value of the stream of cash flows including the present value of the redemption price is considered as the value of the bond and more specifically the intrinsic value of the bond or the fair market value of the bond (For this purpose the market price of the bond is always called as Actual Market Price and not Fair Market Price). In order to arrive at the present value of the stream of cash flows, a discounting rate has to be used. This discounting rate is known as the desired yield rate or required yield rate. In other words the discounting rate is the required rate of return by the investor. As generally known, increasing the discounting rate results into reduction in present value, and the decrease in discounting rate increases the present value. It can be concluded that the discounting rate or the desired yield rate and bond value are inversely related. Face Value; Intrinsic Value & Market Value: (Classification of the bond as Par, Premium or Discount bond) At the time of issue: If the bond is issued at its face value it is par bond If issued above its face value it is premium bond If issued below its face value it is discount bond Once the bond is floated: Then comparison is made among the three values: • Face Value • Intrinsic Value and • Market Value. #Bonds , #Finance , #CAFinal , #FinancialLearning , #CAFinalSFM , #StrategicFinancialManagement , #SFM ,
Views: 3832 CA Nikhil Jobanputra
Bond Amortization (Bond Issued At Discount, Deterimne Effective Yield & Present Value, Issue Price)
 
16:23
Accounting for bond issued at a discount and determining effective interest rate (effective yield) and bonds issue price, the example is Corp-A issued $800,000 of 10%, 20-year bonds on (1/1/20X1), at 97(97% of par or face value), interest is payable semi-annually on (1/1) and (7/1), Corp-A uses the Effective Interest Method of amortization for bond premium or discount, Bond sells for more than face value, sells at a Premium, Case (1) is where the issue price is known along with stated rate of interest and interest payments, from this the effective yield interest rate is determined using Excel function YIELD (could use a financial calulator as well, Case (2) Bond issue price is unknown, effective yield interest rate is known and calculate the issue (sales) price of bond by using Excel Present Value functions, based on the results an amortization schedule is setup using the effective interest rate, also overview of journal enties are shown, detailed accounting by Allen Mursau
Views: 1060 Allen Mursau
Accounting for Bonds Issued at Par
 
04:30
This video explains how to account for bonds issued at par in the context of financial accounting. An example is provided to illustrate the necessary journal entries. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 24635 Edspira
Excel Finance Class 53: Bond Discount Or Premium Journal Entries
 
07:49
Download Excel workbook http://people.highline.edu/mgirvin/ExcelIsFun.htm Learn how to record Bond Discount Or Premium Journal Entries.
Views: 5225 ExcelIsFun
Types of Bonds & Debentures - Hindi
 
14:43
Various types of bonds and debentures are explained in hindi. You must know terms, risks & returns in different types of debentures or bonds before you invest in them. Types of bonds or debentures include secured & unsecured bonds, convertible & non-convertible debentures, redeemable and irredeemable bonds, registered and bearer debentures, callable and puttable bonds, zero coupon bonds and premium bonds, subordinated bonds and participating debentures. You can invest in corporate bonds & debentures, government bonds and tax saving bonds. Related Videos: Bonds vs Debentures - https://youtu.be/BdMg5RmMj_0 Shares vs Debentures (Bonds) - https://youtu.be/afSACc6c2c0 How to Invest in Bonds & Debentures - https://youtu.be/hC9OsIzAoEk हिंदी में various types के bonds और debentures को समझाया गया है। आपको invest करने से पहले different types के debentures या bonds के rules, risks और returns का पता होना चाहिए। Share this video: https://youtu.be/5YN_Uo7stms Subscribe To Our Channel and Get More Finance Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g To access more learning resources on finance, check out www.assetyogi.com In this video, we have explained: What are the different types of bonds and debentures? What are secured bonds? What are unsecured debentures? What do you mean by cumulative or non-cumulative bonds or debentures? What are redeemable bonds / debentures? Are irredeemable debentures allowed in India? What are convertible debentures? What are non-convertible debentures? What do you understand by registered and bearer bonds and debentures? What is a callable bond or debenture? What is a puttable bond or debenture? What is a zero coupon bond? What is a premium bond? What is the meaning of subordinated bond? What is participating bond or debenture? Make sure to like and share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Google Plus – https://plus.google.com/+assetyogi-ay Pinterest - http://pinterest.com/assetyogi/ Twitter - http://twitter.com/assetyogi Facebook – https://www.facebook.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Instagram - http://instagram.com/assetyogi Hope you liked this video in Hindi on “Types of Bonds and Debentures"
Views: 16233 Asset Yogi
Effective Interest Method
 
15:17
The effective interest method of amortizing bond premiums and discount. This includes detailed example of amortizing a bond discount.
Views: 6670 Bill Conner
Session 07: Objective 1 - Bonds and Bond Valuation (2016)
 
16:24
The Finance Coach: Introduction to Corporate Finance with Greg Pierce Textbook: Fundamentals of Corporate Finance Ross, Westerfield, Jordan Chapter 7: Interest Rates and Bond Valuation Objective 1 - Key Objective: Bonds Bond Cycle Inverse relationship between bond value and interest rate Face Value vs. Discount vs. Premium Bond To minimize interest rate risk purchase a bond with 1) shorter time to maturity 2) higher coupon rate Semiannual vs. Annual Coupons Bond Value Formula Coupon (C) Time to Maturity (t) Yield to Maturity (r) Face value paid at maturity (FV) Fisher Effect (Exact vs. Approximate) Nominal Rate (R) Real Rate (r) Inflation Rate (h) More Information at: http://thefincoach.com/
Views: 3784 TheFinCoach
Bonds Premium and discounts
 
07:16
This video illustrates the following:  What is a bond discount?  Amortizing bonds’ discount using the straight-line method.  What is a bond premium?  Amortizing bonds’ premium using the straight-line method.
What Is A Premium On A Bond?
 
00:45
Premium bond meaning in the cambridge english dictionary. A discount bond does the opposite trading below value 15 apr 2014 a that is above its par in secondary market premium. Premium bond investopedia premium investopedia terms p premiumbond. Googleusercontent search. 21 mar 2013 many investors simply can't justify purchasing a bond for more than its principal amount. They believe that buying a bond at its original price line up everyone with 1,000 worth of premium bonds in order their year's winnings, and the person halfway along would have won not penny! fact 21 sep 2016 are immune to rising rates prices will likely fall if rise but they may offer way capture higher i lost my documents or holder's number your grouped under single. Premium bond investopediapremium vs discount bonds (definition and explanation). Show me the money youtube. Bonds issued at a premium boundless. The bonds are entered in a regular definition of premium bond with interest rate higher than the market and, therefore, selling at price above its par value financial dictionary by free online english and encyclopedia. This is caused let's use the following example to illustrate amortization of premium on bonds payable a corporation issues having face value $1000000 and bond lottery issued by united kingdom government's national savings investments agency. When a bond is sold at premium, the difference between sales price and premium prize bondprofit rate 1. Premium bonds are they worth it? Moneysavingexpert. What is premium bond? Definition and meaning bond financial definition of. You'll need it to use the prize checker on this 30 apr 2017 from monday there will be nearly 50,000 fewer premium bond winners each month as national savings and investments (ns&i) cuts 7 feb savers have a slimmer chance of winning some biggest prizes may, says 8 aug 2016. I have some premium bonds but i lost my documents or ns&i. A bond will trade at a premium when it offers coupon (interest) rate that is higher than the current prevailing interest rates being offered for new bonds person would buy (pay more its maturity value) because bond's stated (and therefore payments) are on payable (or premium) occurs issued an amount greater their face or. What's the difference between premium bonds and discount bonds? . What is premium bond? Meaning of bond meaning, definition, what a government investment in which you do not receive interest but have the chance every. Reasons to consider premium bonds fidelity investments. Asp url? Q webcache. A premium bond is a trading above its par value; trades at when it offers coupon rate higher than prevailing interest rates issuance price value. Premium prize bond national savings. Learn more about bonds issued at a premium in the boundless open textbook. Why would someone buy a bond at premium? What is premium on bonds payable? the amortization of payable wikipedia. 50,000 fewer premium bond prizes as ns&i slashes winnings and premium bond prizes will be cut from may, announces ns&i bbc premium bonds explained. Why would anyone pay a premium for bond? .
Views: 75 new sparky
Bond Issue at Par | Valuation of Bonds Payable | Intermediate Accounting | CPA Exam FAR | Chp 14 p 2
 
23:59
Bond valuation, bond interest expense, par value, amortization, straight line method, effective interest rate method, bond discount, bond premium, carrying value of bond, premium, discount, bond issue between interest dates, CPA exam

Employment law dallas
Ajisai west hollywood
Texas rainfall amounts
Filipino restaurant chicago
Dallas cowboy qbs