show solution 3Abc Smile Corp. Issued 16% p.a., 10-year Debenture bond, P6,000 face value,interest due every four (4) months. On October 1, Hapi purchased 20 bonds at par.On May 31, she sold 8 bonds to Honey at 105-3/4. Again on September 30, Hapisold another 6 bonds to Sweet at 96-1/2.Required:3. Assuming Smile Corp., issues a call notice to redeem the debenture bondissuances. This bond has still 4 years life before its maturity at a call price of 110-1/4.Hapi has still six (6) debenture bonds, and is now selling at 106-3/4. If Hapi exercisethe call option:a. How much is the total amount she will be receiving?b. Compute for the yield to call.c. What is the capital gains yield?

a. If Hapi exercises the call option, he will receive the call price of 110-1/4 for each of his…

Answered: 3. Assuming Smile Corp., issues a call…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

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Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 6PA: Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1,...

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