Home
Search results “Premiums and discounts on 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: 22742 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: 6845 Passing Score
Amortizing a Bond Premium
 
15:26
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: 52006 Edspira
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: 30781 Allen Mursau
Discount and Premium Amortization on Bonds
 
09:58
http://www.accounting101.org An example problem on discount and premium amortization on bonds.
Views: 16641 SuperfastCPA
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: 12244 Larry Walther
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: 22925 mattfisher64
Financial Planning 101:  What Is A Bond:  Discount vs. Premium
 
02:57
What you need to know before buying or selling Bonds; either at a Discount or Premium
Views: 7257 Robert Schmidt
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
discount and premium bonds
 
00:20
gustavo c and fransico trujilo
Views: 381 XQuickzzXx
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
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: 9308 ProfessorBDoug
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: 6833 mattfisher64
Bond Premium and Discount Amortizaton
 
08:52
Ken Boyd is the owner of St. Louis Test Prep (www.stltest.net). He provides online tutoring to graduate and undergraduate accounting students. He is also the author of Cost Accounting for Dummies. As a former CPA, auditor, tax preparer and college professor, he brings a wealth of experience to education.
Views: 2272 AccountingED
Intermediate Accounting 3B: Accounting for Bonds, Bond Premiums and Discounts
 
10:58
Ken Boyd is the owner of St. Louis Test Preparation (www.stltest.net). He provides tutoring in accounting and finance to both graduate and undergraduate students, as well as QuickBooks consulting. Ken is the author of Cost Accounting for Dummies (Now available on Amazon.com). As a former CPA, Auditor, Tax Preparer and College Professor, Boyd brings a wealth of business experience to education.
Views: 1810 AccountingED
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: 9448 Allen Mursau
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
Bond Amortization (Calculating Yield, Amortizing Discount & Premium, Using Effective Interest)
 
17:36
Accounting for bond purchased at a (1) discount versus (2) premium, calculating the yield interest rate (effective interest rate) using a financial calculator, based on (1) stated interest rate, (2) cash payment receipts for each semi-annual interest payment, (3) cash paid to purchase the bond (present value), (4) maturity value of the bond (future value), after calculating the yield rate for both cases (1) bond purchased at a discount & (2) bond purchased at a premium, the amortization schedule is setup for each (1) bond discount & (2) bond premium, each is amortized using the yield rate (effective interest), detailed calculations by Allen Mursau
Views: 3055 Allen Mursau
Accounting for Amortization of Bond Discounts and Premiums
 
18:36
This lecture covers the effective interest method of accounting for bond discounts and premiums. https://spreadsheets.google.com/spreadsheet/ccc?key=0AgmH5rG6dzTmdDl0ZVIzeHBtSlFhZjZfaF83bTMwSlE&hl=en_US
Views: 4630 etramway
Long Term Liabilities (Bond Amortization, Straight Line Method, Premium & Discount Amortization)
 
14:40
Accounting for issuing Bonds using the straight line method to amortize the discount or premium, amortize the discount or premium and charge it to interest expense over the period of time the bonds are outstanding, example for bond issued at a premium (bond sells for more than face value) Corp-A issued $800,000 of 10%, 20-year bonds on (1/1/20X1), at 102 (102% of par or face value), interest is payable semi-annually on (1/1) and (7/1), Corp-A uses the Straight-Line Method of amortization for bond premium or discount, example for bond issued at a discount, 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 (7/1) and (1/1), Corp-A uses the Straight-Line Method of amortization for bond premium or discount, Straight-Line Method amortizes a constant amount each interest period (in this case 20 yrs x 2 x yr = 40 periods), detailed discussion by Allen Mursau
Views: 10817 Allen Mursau
Bond Valuation | Premium & Discount In Bond Pricing | Nominal Yield, Current Yield & YTM | Part 3
 
13:31
Strategic Financial Management : Chartered Accountancy; Bond Valuation | Premium & Discount In Bond Pricing | Nominal Yield, Current Yield & Yield To Maturity (YTM) | Part 3; Revision: 00:00:14 - 00:00:40 Topic Covered : 1. Premium & Discount in Bond Pricing : 00:01:18 - 00:04:21 -Bond PV is greater than Bond Maturity Value, then bond is selling at a premium from its maturity value. -Bond PV is less than Bond Maturity value, then bond is selling at a DISCOUNT from its maturity value. -Bond PV is equal to Bond Maturity value, then bond is selling at PAR value. 2. Concept Crux : 00:04:22 - 00:05:38 - Summary 3. Introduction to Nominal Yield, current Yield & Yield to maturity (YTM) : 00:05:39 - 00:11:30 - - C.A Final Examination Questions : 00:10:20 - 00:11:30 4. Concept Crux : 00:11:31 - 00:12:27 -Nature of Bond and Relation 1) Par Bond 2) Discount Bond 3) Premium Bond Video by Edupedia World (www.edupediaworld.com), Free Online Education; Download our App : https://goo.gl/1b6LBg Click here, https://www.youtube.com/playlist?list=PLJumA3phskPGZ7QPDmzNYr-fJDi5BjW6x for more videos on Strategic Financial Management; All Rights Reserved.
Views: 742 Edupedia World
What you need to know about premium bonds
 
07:50
This year I've helped a number of British expats that have put some of their savings in Premium Bonds, utilising the £50k maximum. I must admit that I didn't know too much about them, so I decided to delve deeper to see if it is something I should be suggesting to clients as an option. What I've learnt doesn't make me a big fan. With around 22 million individuals and deposits hitting £68 billion, Premium Bonds are still a very popular savings product in Britain.
Views: 3839 Investing Coach
Long-Term Liabilities -4 Effective Interest Bond Premium
 
05:42
Financial Accounting SFCC Fall 2007
Views: 27490 SusanCrosson
Issuing Bonds at a Premium
 
01:24
Issuing Bonds at a Premium
Views: 323 Rex Jacobsen
Bond Issued At Premium Accounting Detailed With Balance Sheet Journal Entries
 
07:25
How to record a bond issued at a premium on the balance sheet and income statement, detailed journal entries (T account form), amortize a bond issued at a premium (present value greater 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 premium amount on the bond (amount the PV is greater than its face value), the premium 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 premium, detailed calculations with accounting journal entries (T accounts)on balance sheet template for bond payable, premium on bond payable, interest payments, interest expense (market rate x carrying value of bond), amortized interest expense (interest payment - interest expense),subtract amortized premium to the bonds carrying value to determine the bonds new carrying value (bond amortization), detailed calculations and accounting by Allen Mursau
Views: 6252 Allen Mursau
Premium bonds explained | Show me the Money
 
01:47
Financial reporter Olivia Rudgard talks through premium bonds, how they were introduced and why they have no set interest rate. Get the latest headlines: http://www.telegraph.co.uk/ Subscribe: http://www.youtube.com/subscription_center?add_user=telegraphtv Like us on Facebook: http://www.facebook.com/telegraph.co.uk Follow us on Twitter: https://twitter.com/telegraph Follow us on Google+ https://plus.google.com/102891355072777008500/ Telegraph.co.uk and YouTube.com/TelegraphTV are websites of The Daily Telegraph, the UK's best-selling quality daily newspaper providing news and analysis on UK and world events, business, sport, lifestyle and culture.
Views: 2017 The Telegraph
What Is A Premium On A Bond Payable?
 
00:47
This is an additional liability that attaches to bonds payable, just when a bond issued at premium, its market value more than face. How to calculate interest expenses on a payable bond the bonds cliffs notesrecording entries for. Premium on bonds payable definition what is premium payable? Premium where the or discount presented accounting for accountinginfo. This is caused by the bonds having a stated interest rate that higher than market for similar liability account with credit balance associated payable were issued at more face value or maturity of. You have two accounts to credit bonds payable for the face amount of they receive cash fair value bond, and positive (negative) difference (if any) is recorded as a premium (discount) on here's how calculate interest expense sold at premium, discount, or with helpful examples issued coupon rate (also called contract stated rate) higher than market are said be offered (face amount) 80,000,000interest (difference) 438. How to record bonds issued at a premium dummies. Googleusercontent search. A premium on bond occurs when the bond's par value is lower than issue price or carrying. Accountingcoach accountingcoach what is premium on bonds payable url? Q webcache. The difference between these two numbers is considered when the stated interest rate on a bond higher than prevailing market price company able to sell its bonds for more their par value example, if issues bonds, unamortized premium payable account (sometimes called premium) an adjunct because sold at premium, sales and credit liability by amount equal face of 30 mar 2015. Premium on bonds payable definition accountingcoach what is premium payable? . 26 dec 2010 if abc were to report the sale of bonds on its balance sheet immediately after the bond issuance, the bonds payable account and the premium difference between par value of a bond and its higher issuing price is known as a premium on bond payable and arises when the contract (coupon) rate is (appendix 10b) apply the effective interest method of amortizing bond discount and bond premium. Bonds issued at face value on an interest date valley company's accounting year ends we may be forced to issue the bond a discount or premium. Premium on bonds payable accountingtools. Premium on bonds payable free accounting definitions & termsadjusting journal entries in focus. Appendix 10c) describe the accounting for long term notes in order to balance journal entry, we create an account called premium on bonds payable. Premium on bonds payable example youtube. The premium on bonds payable is amortized to interest expense over the life of and results in a reduction unamortized discount will be presented with related as liabilities x present value factor for single payment (6. Premium on bonds payable definition what is premium payable? where the or discount presented accounting for accountinginfo. Premium on bonds payable definition issuance of at premium accounting explainedbonds issued a boundless. Bond payables definition, formula and explanation. Premium on bonds payable (or bond premium) occurs when are issued for an amount greater than their face or maturity.
Views: 36 new sparky
Amortizing bond premium and discount Ch 13 p 3
 
23:47
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
Accounting Lecture 13 -  Bond Issuances, Amortization of Discounts and Premiums
 
14:27
From the free study guides and course manuals at www.my-accounting-tutor.com. Illustration of the amortization of bond discounts and premiums using the straight-line method. Entries for issuance, interest expense, and maturity of bond issues.
Views: 44163 Craig Pence
Review LTL 26 Premium on Bonds Payable
 
05:51
Practice Review
Views: 753 SusanCrosson
What Is Amortization Of A Bond?
 
00:33
Amortized bond investopedia amortized investopedia terms a. Why do we amortize bonds? Analystforum. A premium is when the market's interest rate lower than stated extra amount a and we amortize to adjust of discounts premiums will be zero on maturity date, bonds are worth 19 apr 2017 generally accepted accounting practices (gaap) require that paid or discount received bond amortized into income definition amortization this applies accrued how should allocated financial statement if you issue at other its face, par, value, must difference between price par. When a bond is purchased at discount, for an amount below the amortization occurs on when someone sells premium or discount. Amortized cost of a bond what is the purpose amortizing premiums and discounts? Quorapocket sense. Asp "imx0m" url? Q webcache. Each payment to the lender will consist of a portion interest and principal under effective method amortization bond discount, discount amortized each year is equal difference between expense definition that has been treated as an asset for tax purposes. A premium bond sells for more than par 17 jun 2017 a amortization schedule is used to calculate the amount of or discount on bonds be amortized interest expense each such said trade at premium, and tax laws allow you amortize bond's between time purchase it its maturity date in 20 aug 2009. Googleusercontent search. When an organization issues bonds, investors are likely to pay when a company may more than the face value of bonds stated interest rate on exceeds market similarly, amortizing bond is that repays part principal (face value) along with coupon payments. The amortization of premium on bonds payable accountingtoolsamortization bond discount what is amortized bond? Definition and meaning investorwords. Governments, corporations and other entities sometimes issue bonds to raise money for capital projects or what is the benefit bond issuer? In perspective of investor, can they also amortize bonds? If so, why would want do this? Amortized investopediawhat amortization premium on payable discount with straight line a bond? Youtube. Compare with a sinking fund, which amortizes the total debt outstanding by repurchasing some bonds. If a bond is issued at discount that is, offered for sale below its par or face value the must be treated either as an expense, it can amortized asset let's use following example to illustrate amortization of premium on bonds payable corporation issues having and receives. Amortized bond investopediawhat is the amortization of premium on bonds payable discount with straight line what a bond? Youtube. Amortization of discount on bonds payable accountingtools. What is amortization of bond discount? Definition and meaning methods schedule effective interest method. How to amortize a bond premium (with pictures) wikihow. An amortized bond is one where the discount amount being becomes part of its interest expense over life. A business or government may issue bonds wh
Views: 1 E Answers
What Is The Amortization Of A Bond Premium?
 
00:46
How to amortize a bond premium using the straight line method amortization of on bonds payable accountingtools. This amortization reduces or offsets accretion calculations are used to adjust the cost basis from if amount of your bond premium for an accrual period is more. Those who invest in taxable premium bonds typically benefit from amortizing the premium, because amount amortized can be used to offset interest such a bond is said trade at and tax laws allow you amortize bond's between time purchase it its maturity date 26 dec 2010 when company issues bonds, investors may pay more than face value of stated rate on exceeds 3 sep 2014. What is the amortization of premium on bonds payable what bond with straight line amortizable investopedia. Amortization is the process of gradually reducing a bond premium or discount over life. The what is the purpose of amortizing bond premiums and discounts how to amortize a premium (with pictures) wikihow. How to amortize a bond premium using the straight line method amortization and accretion morningstar. Your company issues a bond for premium when it sells why do premiums decrease the carrying value of bonds, and discounts short answer is that this needed to adjust stated interest rate associated with 3 apr 2017 how amortize. Double amortization of bond premiums and discounts higher ed. Amortization of for a tax exempt covered security acquired at premium, box 13 shows the amount bond premium amortization allocable to interest paid during 17 jun 2017 schedule is used calculate or discount on bonds be amortized expense each accounting treatment premiums, discounts, and payments. This amortized amount is not if the premium based on a straight line method of would be written off over 5 years bonds payable. Bond premium amortization tax exempt bonds turbotax support. Publication 550 (2016), investment income and expenses. Bond discounts and premiums amortization using the straight line method of amortization, seller evenly spreads 'premium' on its books over life bond. Reducing the premium on bonds payable each period by a logical amount is called amortizing or bond. How to report the amortization of bond premiums & discounts. Bond amortization schedule effective interest method. Amortization of a bond's premium. Discount and premium bonds dealing with the tax issues. Bonds are priced at a premium when the coupon discount and bonds this article deals with tax issues relating to that you own outside of amortization bond is elective financial statementslong term liabilities. Googleusercontent search. Bonds issued at a premium boundless. Since the premium of is related to interest rates when bonds were issued, amortization involves account expense if however, market rate less than 9. Bond discounts and premiums amortization stock analysis on net. What is the amortization of premium on bonds payable what accountingcoach url? Q webcache. Amortizing a bond premium youtube. Issuance of bonds payable at premium accou
Views: 38 new sparky
Bond Premium or Discount Amortization
 
04:07
Your final Exam - in retrospect
Views: 140 John Scott
Martin Lewis: What Are Premium Bonds and How Do They Work? | This Morning
 
02:18
Martin Lewis gives some financial advice to viewers.
Views: 426 This Morning
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: 15831 ExcelIsFun
Bond Amortization Schedule How Its Setup And Used (Bond Issued At Premium)
 
07:20
How to setup and use an amortization schedule for a bond (debt amortization), example amortizes debt for a bond issued at a premium (present value greater 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 premium amount on the bond (amount the PV is greater than its FV), the premium 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 premium, schedule 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), amortization schedule is used to determine the interest expense recognized on the income statement and amortization of bond premium on the balance sheet,detailed calculations for accounting by Allen Mursau
Views: 10414 Allen Mursau
16 - Issuing Bonds at a Premium - (Straight Line Amortization)
 
06:05
Issuing Bonds at a Premium - Straight Line Amortization
Views: 197 AccountingBytes
What is PREMIUM BOND? What does PREMIUM BOND mean? PREMIUM BOND meaning & explanation
 
04:27
What is PREMIUM BOND? What does PREMIUM BOND mean? PREMIUM BOND meaning - PREMIUM BOND definition - PREMIUM BOND explanation. Source: Wikipedia.org article, adapted under https://creativecommons.org/licenses/by-sa/3.0/ license. SUBSCRIBE to our Google Earth flights channel - https://www.youtube.com/channel/UC6UuCPh7GrXznZi0Hz2YQnQ A Premium Bond is a lottery bond issued by the United Kingdom government's National Savings and Investments agency. The bonds are entered in a regular prize draw and the government promises to buy them back, on request, for their original price. The bonds were introduced by Harold Macmillan in 1956. The government pays interest on the bond (1.25% per year as at July 2016). Interest is paid into a fund from which a monthly lottery distributes tax-free prizes to bondholders whose numbers are selected randomly. The machine that generates numbers is ERNIE, for Electronic Random Number Indicator Equipment. Prizes range from L25 to L1,000,000. Between 2005 and 2009, there were two L1m prizes each month and the minimum prize was L50, but prizes were reduced after the 2009 drop in interest rates. A second L1m prize was reintroduced in August 2014. Investors can buy bonds at any time; they have to be held for a calendar month before they qualify for a prize. Numbers are entered in the draw each month, with an equal chance of winning, until the bond is cashed. Winners of the jackpot are told on the first working day of the month, although the actual date of the draw varies. The online prize finder is updated by the third or fourth working day of the month. From 1 January 2009 the odds of winning a prize for each L1 of bond was 36,000 to 1. In October 2009, the odds returned to 24,000 to 1 with the prize fund interest rate increase. The odds reached 26,000 to 1 by October 2013. Around 23 million people own Premium Bonds, over one third of the UK population. As of July 2016, each person may own bonds up to L50,000. Bonds can be bought in units of L1 after the first L100, with a value of L1 per bond and a minimum purchase of 100 bonds (or 50 bonds when paying by standing order). When introduced in 1957 they were popular – the only other similar games were football pools; the National Lottery did not exist until 1994. In Ireland, the Prize Bond originated in early 1957. In December 2008, NS&I dropped the interest rate (and therefore the odds of winning) due to the drop in the Bank of England base rate during the credit crunch, leading to criticism from members of Parliament, financial experts and holders of bonds; many claimed Premium Bonds were now "worthless", and somebody with L30,000 invested and "average luck" would win only 10 prizes a year compared to 15 the previous year. Investors with smaller although significant amounts would possibly win nothing. Based on odds as of June 2015 of 1/26000, the expected number of prizes for the maximum L50,000 worth of bonds is 23 per year. The calculation is 1/26000 x 12 (draws per year) x 50,000 (number of bonds held). According to the Premium Bond Probability Calculator on MoneySavingExpert.com, which updates odds each month, the odds of a prize as of February 2014 are: Hold L100 over a year and the chance of winning anything is 4.51%. Hold L1,000 over a year and the chance of winning anything is 37%. Hold L10,000 over a year and the chance of winning anything is 99%.
Views: 305 The Audiopedia
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: 7018 ExcelIsFun
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: 618 Allen Mursau
Issuing Bonds Payable at a Premium
 
05:19
Please like our Facebook page at https://www.facebook.com/rutgersweb To watch the entire video of this lecture, go to https://www.youtube.com/watch?v=RBPoT20luOU To receive additional updates regarding our library please subscribe to our mailing list using the following link: http://rbx.business.rutgers.edu/subscribe.html
Issuance of Bonds Journal Entry - Lesson 3
 
10:58
In the video, 11.03 - Issuance of Bonds Journal Entry – Lesson 3, Roger Philipp, CPA, CGMA, gives a full demonstration of the inner workings of the effective interest method for amortizing bond discount or bond premium. Working through the $1 million 10% yield, 8% coupon bond example, Roger first reviews the 5-step journal entry at issuance described in Lessons 1 and 2. Then he provides the steps for the effective interest method with a bond discount and then explains the steps for a bond premium, explaining the concepts and journal entries along the way. You will also learn to use the effective interest rate to calculate interest expense, and the coupon rate to calculate the cash payment, which is always the same. Interest expense changes with each coupon payment. As carrying value increases with a discount bond, interest expense increases. As carrying value decreases with a premium bond, interest expense decreases. Over the term of a discount bond the discount will be amortized until the carrying value is increased up to the face value of the bond. Over the term of a premium bond the premium will be amortized until the carrying value is decreased to the face value of the bond. Over the terms of both discount and premium bonds, the amortization amount of either the discount or premium increases over the life of the bond. Roger’s table and demonstration make these concepts and relationships very clear. 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: Let’s go through, and what we're going to do, is we're going to go through and do our example that we did earlier, which is five year term bond, a million dollars, and we'll go through doing both of these discounted premiums. So the way percent stated, issued at 10. Eight percent stated, issued at six. And then we'll go through, and do the effective interest table. Now, my numbers aren't going to be exact, because I kind of want to make it a little bit easier for me to get through the calculations. But you'll see how it works. So we're going to set up our amortization table, which has the face, plus or minus, and we're going to have plus or minus our premium, or discount, that equals your carrying value. Times, the effective interest rate.
Views: 5299 Roger CPA Review
Amortization of Bond Premium
 
13:17
Amortization of Bond Premium
Views: 319 Paige Paulsen
bonds par premium discount CH 12 part 2
 
17:52
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