The Note About Debt Included in the Financial Statements of Healdsburg

question 60

Essay

The note about debt included in the financial statements of Healdsburg Company for the year ended December 31, 2017 disclosed the following:

Debt. The following table summarizes the long-term debt of the Company at December 31, 2017. All of the notes were originally issued at their face (maturity) value and have been gradually repaid over time so that these amounts are the remaining balances at this date.

Required: Assuming that the notes pay interest annually and mature on December 31 of the respective years, compute the following:
-Suppose that Healdsburg wants to pay off the 7.75% notes on December 31, 2018, (i.e., five years early) when the going interest rate is 6%, thereby retiring the $345,154,000 in debt. How much would Healdsburg have to pay for the notes (principal only) on this date in order to satisfy the noteholders?

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