Ask Question
BusinessBusiness
18 August, 18:08

Barrington Corporation paid $26,000 to have bond certificates printed and engraved, $100,000 in legal fees, and $8,000 to a CPA for registration information. Barrington sold the bonds to an underwriter. The spread between the price the underwriter paid and the resale price was $230,000. What is the amount of debt issue costs?

+3
Answers (1)
  1. 18 August, 18:09
    0
    The bond's issue costs is $364000

    Explanation:

    The issue costs of the debt financing is listed below:

    Payment for printing and engraving $26000

    Legal fees $100000

    Professional fees $8000

    Underwriter's spread $230000

    Total issue costs $364000

    All the above highlighted costs are relevant to the bond's issuance, hence they are added up in arriving at the bond's issuance costs.

    The spread between the payment by the underwriter and the retail price is essential so as to ensure the number of bonds planned can be sold quickly.

    It is more like the payment to the underwriter to underwrite and ensure everything is sold.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Barrington Corporation paid $26,000 to have bond certificates printed and engraved, $100,000 in legal fees, and $8,000 to a CPA for ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Large retailers like walmart have enormous channel control due to their size and power. which type of channel arrangement does this represent?
Answers (1)
Kelly's kitchen, a popular chain of fast food restaurants, offers a kids' meal pack free with every purchase of its newly introduced luxury meal pack. this is an example of a:
Answers (1)
Elasticity measures the behavioral response of economic agents in a given situation. Which of the following questions is likely to be answered using elasticity? a) If a business raises it prices, will that have a large or small on demand?
Answers (1)
Over the next 40 years, the number of people over the age of 65 is projected to
Answers (1)
What two things do many employers use to judge an employee's performance?
Answers (2)
New Questions in Business
A fire destroys all of the merchandise of Coronado Company on February 10, 2017. Presented below is information compiled up to the date of the fire: Inventory, January 1, 2017 $423,300 Sales revenue to February 10, 2017 1,924,500 Purchases to
Answers (1)
How should you use operating costs when calculating incremental cash flows? Group of answer choices: A. Do not subtract operating costs, and then subtract taxes on operating income before operating costs. B. Subtract operating costs. C.
Answers (1)
The following selected data are from a recent statement of cash flows: Net cash flow from operating activities $ 35,000 Net cash flow used for investing activities (20,000) Net cash flow used for financing activities 60,000 Ending cash balance
Answers (1)
Gates Corporation reported the following information concerning its direct materials: Direct materials purchased (actual) $ 673,000 Standard cost of materials purchased $ 688,000 Standard price times actual amount of materials used $ 444,000 Actual
Answers (1)
how fiscal policy can be used to slow down an economy that is growing at a rate faster than what is sustainable in the long-term if the policy makers are concerned that such a high growth may create undesirably high rates of inflation in the future.
Answers (1)
Home » Business » Barrington Corporation paid $26,000 to have bond certificates printed and engraved, $100,000 in legal fees, and $8,000 to a CPA for registration information. Barrington sold the bonds to an underwriter.
Sign Up Forgot Password?