19. On January 1, 2023, Peace & Calm Corporation purchased P4,000,000 8% bonds for P3,870,304. Peace & Calm records the financial asset at fair value through other comprehensive income. However, if market interest rates fall sufficiently, Peace & Calm will consider selling the investment in bonds to realize associated gain. The bonds were purchased to yield 9%. Interest is payable annually every December 31. The bonds mature on December 31, 2026. On December 31, 2023, the bonds were selling at 102. On December 31, 2024, Peace & Calm sold 25% of the bonds at 104, which is the fair value of the bonds on that date, plus accrued interest. How much is the unrealized gain to be recognized as component of equity on December 31, 2023? a. 289,696 b. 238,023 C. 209,696 181,369
19. On January 1, 2023, Peace & Calm Corporation purchased P4,000,000 8% bonds for P3,870,304. Peace & Calm records the financial asset at fair value through other comprehensive income. However, if market interest rates fall sufficiently, Peace & Calm will consider selling the investment in bonds to realize associated gain. The bonds were purchased to yield 9%. Interest is payable annually every December 31. The bonds mature on December 31, 2026. On December 31, 2023, the bonds were selling at 102. On December 31, 2024, Peace & Calm sold 25% of the bonds at 104, which is the fair value of the bonds on that date, plus accrued interest. How much is the unrealized gain to be recognized as component of equity on December 31, 2023? a. 289,696 b. 238,023 C. 209,696 181,369
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:19. On January 1, 2023, Peace & Calm Corporation purchased P4,000,000 8% bonds for P3,870,304. Peace
& Calm records the financial asset at fair value through other comprehensive income. However, if market
interest rates fall sufficiently, Peace & Calm will consider selling the investment in bonds to realize
associated gain. The bonds were purchased to yield 9%. Interest is payable annually every December
31. The bonds mature on December 31, 2026.
On December 31, 2023, the bonds were selling at 102. On December 31, 2024, Peace & Calm sold 25%
of the bonds at 104, which is the fair value of the bonds on that date, plus accrued interest. How much is
the unrealized gain to be recognized as component of equity on December 31, 2023?
a. 289,696
b. 238,023
C.
209,696
181,369
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