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. On January 1, 2020, HIBISCUS Company purchased 4,000 of ₱1,000 face value, 10% bonds of IXORA Company for ₱4,270,600. The bonds will mature on January 1, 2025, and pay interest semi-annually on January 1 and July 1. Bond's effective interest rate is 8%. HIBISCUS has a business model of collecting all the contractual cash flows related to the instrument. How much should HIBISCUS report as interest income for the year ended December 31, 2020, on the bonds? * PLEASE SHOW YOUR SOLUTIONS IN GOOD ACCOUNTIN

. On January 1, 2020, HIBISCUS Company purchased 4,000 of ₱1,000 face value, 10% bonds of IXORA Company for ₱4,270,600. The bonds will mature on January 1, 2025, and pay interest semi-annually on January 1 and July 1. Bond's effective interest rate is 8%. HIBISCUS has a business model of collecting all the contractual cash flows related to the instrument. How much should HIBISCUS report as interest income for the year ended December 31, 2020, on the bonds? * PLEASE SHOW YOUR SOLUTIONS IN GOOD ACCOUNTIN

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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9. On January 1, 2020, HIBISCUS Company purchased 4,000 of ₱1,000 face value, 10% bonds of IXORA Company for ₱4,270,600. The bonds will mature on January 1, 2025, and pay interest semi-annually on January 1 and July 1. Bond's effective interest rate is 8%. HIBISCUS has a business model of collecting all the contractual cash flows related to the instrument. How much should HIBISCUS report as interest income for the year ended December 31, 2020, on the bonds? *
PLEASE SHOW YOUR SOLUTIONS IN GOOD ACCOUNTING FORM. THANK YOU!
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