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AIWMI CCRA-L2 Exam - Topic 1 Question 99 Discussion

Actual exam question for AIWMI's CCRA-L2 exam
Question #: 99
Topic #: 1
[All CCRA-L2 Questions]

A coupon bond is trading at 110% of the USD 1000 par value. If the last interest payment was made one month ago and the coupon rate is 12%, the accrued interest on this bond is_______

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Suggested Answer: D

by Ellsworth at Sep 19, 2024, 01:55 PM

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Ngoc
5 months ago
Accrued interest for one month is usually calculated like that.
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Wynell
5 months ago
Wait, how can it be just $10? Sounds off.
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Eladia
6 months ago
Totally agree, it's definitely $10!
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Chandra
6 months ago
I think the accrued interest is $10.
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Annamae
6 months ago
The coupon rate is 12% on a $1000 bond.
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Sharee
6 months ago
This question seems similar to one we practiced where we had to calculate accrued interest. I think it’s around 20, but I can't recall exactly.
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Tonette
6 months ago
I’m not entirely sure, but I feel like the answer should be less than 120 since it’s only been a month.
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India
7 months ago
I think the coupon payment is USD 120, so if it's been a month, we might need to divide that by 6 for the six-month period.
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Edna
7 months ago
I remember that accrued interest is calculated based on the coupon rate and the time since the last payment.
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Deeanna
7 months ago
Alright, let me give this a try. I just need to focus on the details and not overthink it.
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Tawna
7 months ago
I'm a bit confused on how to approach this. Can someone walk me through the steps to solve this type of problem?
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Robt
7 months ago
Okay, I've got this. The accrued interest is based on the coupon rate and the time since the last payment. Let me work through the calculation.
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Queenie
7 months ago
Hmm, this looks like a tricky one. I'll need to think through the formula for accrued interest on a coupon bond.
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Willard
7 months ago
No problem, I've seen these before. The key is to remember the formula and plug in the right values. I think I can get this one right.
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Olive
2 years ago
I'm totally acing this exam, and I've got the answer right here. D) 10 is the way to go, no doubt about it. Unless, of course, the bond is made of chocolate. Then the answer would be 'eat the whole thing'.
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Charlena
1 year ago
Actually, I believe it's D) 10. The accrued interest is just the coupon rate times the par value, regardless of the trading price.
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Crista
1 year ago
I'm pretty sure it's A) 110. The bond is trading at 110% of the par value, so the accrued interest should be the same.
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Meghann
2 years ago
I think the answer is C) 120. The accrued interest should be 12% of the par value.
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Aileen
2 years ago
This is a tricky one! I'm going to go with C) 120, just to keep things interesting. Who needs accurate answers when you can have fun, right?
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Angelyn
1 year ago
I'll choose C) 120.
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Ma
2 years ago
I'm going with B) 100.
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Blondell
2 years ago
I think the answer is A) 110.
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Trina
2 years ago
Ah, the age-old question of accrued interest. I'm pretty sure the answer is 10, but I'll double-check my calculations just to be sure. Yep, definitely D) 10.
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Suzi
1 year ago
Yes, I'm sure. It's 10.
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Dortha
2 years ago
Are you sure? I calculated it to be 110.
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Aileen
2 years ago
No, it's actually 10.
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Stephane
2 years ago
I think it's 120.
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Lynelle
2 years ago
I'm not sure, but I think it's C) 120 as well. The bond is trading above par value, so the accrued interest should be higher.
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Nikita
2 years ago
Hmm, let's see. If the bond is trading at 110% of the par value, that means it's worth USD 1,100. And with a 12% coupon rate, the accrued interest must be 10, right? D) 10 is the answer.
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Shenika
2 years ago
Great, we all agree on D) 10 for the accrued interest.
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Madelyn
2 years ago
So, the accrued interest on the bond is 10.
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Kristofer
2 years ago
Yes, D) 10 seems to be the correct answer.
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Corrina
2 years ago
I think you're right. The accrued interest should be 10.
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Janine
2 years ago
I agree with Tracey. The accrued interest would be 120.
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Tracey
2 years ago
I think the answer is C) 120.
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