Topic: Discount Bonds
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Answers to Common Questions
How to Calculate a Bond Discount
Bonds are one vehicle to invest money. An investor can buy a bond and he will receive periodic interest payments and when the bond matures, receive the face value of the bond. When a bond hits the secondary market, there may be a difference... Read More »
Source: http://www.ehow.com/how_6459126_calculate-bond-discount.html?ref=...
How to Debit a Discount on a Bonds Payable
The use of long-term bonds is one of the ways a corporation can acquire financing to expand the business or pay existing obligations. When a corporation finances the company’s activities using bonds, it creates an obligation for the company... Read More »
Source: http://www.ehow.com/how_12055772_debit-discount-bonds-payable.htm...
How to Calculate Bond Discount Rate
1 Determine how many coupon payments will be made on your bond (most bonds make 2 payments per year so if it is paid over 10 years, you have a total of 20 payments) . 2 Find the coupon rate being paid for the bond for 1 coupon payment (if g... Read More »
Source: http://www.wikihow.com/Calculate-Bond-Discount-Rate
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Discount Bonds
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Answers to Other Common Questions
The amortization of bonds is the process of reducing the cost basis of bonds each period in order to reflect the economic reality that as bonds approach maturity, they must be redeemed at par, or 100. The reality is that amortization is eas...
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Source: http://www.ehow.com/info_7755202_amortize-premium-discount-bonds-...
amount by which the market price of a bond is lower than its face value. Outstanding bonds with fixed coupons go to discounts when market interest rates rise. Discounts are also caused when supply exceeds demand and when a bond’s credit rat...
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Source: http://www.answers.com/topic/bond-discount
bond offered below face value . See also bond discount ; zero coupon bond .
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difference between the face value (par value) of a bond and the proceeds received from the sale of the bond by the issuing company, less whatever portion has been amortized, that is, written off to expense as recorded periodically on the pr...
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Source: http://www.answers.com/topic/unamortized-bond-discount
Bonds can trade in the secondary market at par (face value), at a premium or at a discount depending on their structure and market conditions.
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Source: http://www.ehow.com/facts_7183063_bonds-premium-others-sell-disco...
bond selling for a discount of more than about 20% from its face value. Unlike a current coupon bond, which has a higher interest rate, a deep discount bond will appreciate faster as interest rates fall and drop faster as rates rise. Unlike...
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Source: http://www.answers.com/topic/deep-discount-bond
