Week 13 — Readings & Resources

Your primary reading is Chapter 13 (in this module). Everything below is the optional, go-deeper layer — pick what helps, skip the rest.

How to use this page

This page has 11 items (5 readings and 6 videos). Allow 68–76 minutes for everything. Each group points back to the matching chapter section and class-session segment, so use the full menu when you want more, or take the quick path below.

Every video here has captions: turn them on with the CC button in the player. The chapter covers the same ideas in text.

Pick-one quick path (20–20 min total)

• Straight-line Amortization for Bonds (discount) — Learning with Luke
• How to account for Bonds - Part 2, Premium Bonds — Accounting with Audra

① What a bond promises, and what it is worth

Chapter 13, Section “Price a bond by its present value” · Session 1, Segment 3, “Pricing a bond by its present value” · Remember: the stated rate sets the cash a bond pays, and the market rate sets the price someone will pay for it.

• Bonds: FAQs — Investor.gov, U.S. Securities and Exchange Commission — the SEC's investor-education page on what a bond is: a loan from investors to a government, a city, or a corporation, repaid at its face or par value when it matures, with interest often paid every six months. Read the opening answer and the three main types of bonds; skip the benefits-and-risks part, which is written for investors rather than for the borrower's books. (reading, 5–7 min)
• What are Municipal Bonds — U.S. Securities and Exchange Commission — the SEC's short page on bonds issued by states, cities, and counties to pay for projects such as schools, highways, and sewer systems, with interest usually paid twice a year and the principal repaid at a maturity date that may be years away. Read only the opening paragraphs, which match the city's bond issue the chapter describes as a type. (reading, 3–4 min)
• What are Bonds? A Simple Explanation for Teens and Beginners — Easy Peasy Finance — a young creator's five-minute question-and-answer dialogue: a bond is a loan to a business, unlike a share of stock it gives no ownership, the coupon is the interest paid as a percentage of the principal, and the principal comes back at the end of the term. Watch it for the plain words; its line that the issuer decides a bond's price leaves out the market rate, which the chapter adds. (video, 5 min) (captions: creator)
• Bonds Explained in One Minute — One Minute Economics — an economist's ninety-second sketch of who is who in a bond: the issuer, which may be a company, a municipality, or a country, receives the principal from the bondholder, pays interest called the coupon, and repays at the maturity date, and the bond can be sold to another investor before then. (video, 1 min) (captions: automatic)
• Net Present Value (NPV) explained — The Finance Storyteller — a finance explainer's five-minute lesson whose first two minutes are present value itself: divide an amount due later by one plus the rate once for each period to see what it is worth now. That is the same move the chapter makes with 1.03 for each of the shop's 10 periods. Its second half turns to a project decision, which belongs to managerial finance rather than this course. (video, 5 min) (captions: creator)

② Recording a discount or a premium

Chapter 13, Section “Record bonds issued at a discount” · Session 1, Segment 5, “Issued at a discount” · Remember: Bonds Payable always takes the face value, and the gap between face and cash goes to the discount or premium account.

• What Are Corporate Bonds? — Investor.gov, U.S. Securities and Exchange Commission — the SEC's investor bulletin on corporate bonds. Read the part on a bond's financial terms: face or par value, coupon rate, and a small table of three bonds with the same coupon selling at, below, and above face, followed by the seesaw rule that bond prices move opposite to market interest rates. This builds on Week 12's work with notes payable, now issued to many lenders at once. (reading, 8–10 min)
• How to account for Bonds - Part 2, Premium Bonds — Accounting with Audra — one premium bond followed from the issuer's side: a five-year, $600,000 bond whose 5 percent stated rate is above the 3 percent market rate sells for $654,956, found with present value tables as the present value of the face plus the present value of the interest payments. The issue entry credits Bonds Payable for the face and Premium on Bonds Payable for the other $54,956; each year's interest expense comes out below the $30,000 of cash interest, and an amortization schedule shrinks the premium until the carrying value reaches face. It amortizes by the effective-interest method, which the chapter describes in words, notes that straight-line may be used when the difference is not material, and pays interest once a year rather than every six months like the shop's bonds. Skip its closing remarks on whether an investor should buy bonds at a discount or a premium. (video, 12 min) (captions: automatic)
• Straight-line Amortization for Bonds (discount) — Learning with Luke — an eight-minute amortization table for a two-year bond sold below face, built column by column: the cash interest from face times half the contract rate, the same discount amortization every period, interest expense as their sum, and a carrying value that climbs to face while the discount falls to zero. Its figures are the video's own illustrative business, not the bicycle shop's. (video, 8 min) (captions: automatic)

③ Spreading the cost, and paying debt down

Chapter 13, Section “Compare the effective-interest method, in words” · Session 2, Segment 8, “The effective-interest method, in words” · Remember: every method spreads the same discount and ends at the same face; only the split among periods differs.

• Effective Interest Amortization for Bonds (discount) — Learning with Luke — the same bond as the straight-line video above, now amortized by the effective-interest method: each period's interest expense is the carrying value times the market rate for one period, so the expense and the amortization grow a little every period. Watch it to see the pattern the chapter describes in words; stop before the final part on retiring bonds early, which this course does not cover. (video, 15 min) (captions: automatic)
• What is amortization and how could it affect my auto loan? — Consumer Financial Protection Bureau — a federal consumer agency's short answer on loans repaid in fixed monthly payments: more of each early payment goes to interest and more of each later payment goes to principal, a split shown in an amortization schedule. It is the borrower's view of an installment note; use it while completing the Week-13 module overview. Stop here before stockholders' equity; next week takes up the owners' side of the balance sheet. (reading, 2–3 min)

Optional one-stop reference (free online reference)

• Beginners' Guide to Financial Statements: Balance Sheets — U.S. Securities and Exchange Commission — the SEC's plain-language guide for investors; read its balance sheets section on liabilities, which lists them by due date: current liabilities to be paid off within the year and long-term liabilities due more than one year away. Stop before the income statements section. (reading, 4–6 min)

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