A) Assuming that the securities are classified as debt investments at amortized cost, what is the carrying amount of the debt investment reported on December 31, 2020 statement of financial position? a) 1,000,000 b) 1,051,163 c) 1,055,000 d) 1,065,000 B) Assuming that the securities are classified as debt investments at fair value though profit or loss, what is the carrying amount of the debt investment reported on December 31, 2020 statement of financial position? a) 1,000,000 b) 1,051,163 c) 1,055,000 d) 1,065,000 C) Assuming that the securities are classified as debt investments at fair value through profit or loss, what is the interest revenue from the bond investment for the year 2020? a) 52,913 b) 60,000 c) 106,163 d) 120,000 D) Assuming that the securities are classified as debt investments at amortized cost, what is the interest revenue from the bond investment for the year 2020? a) 53,250 b) 60,000 c) 120,000 d) 106,163
PROBLEM 2: On January 1, 2020, Baymax Company purchased Mad Max Corporation, P1,000,000 12% bonds for P1,065,000, a price that yields 10%. The bonds pay interest semi-annually every January 1 and July 1 and they mature on January 1, 2024. At December 31, 2020, each P1,000,000 bond is selling at P1,055.42.
A) Assuming that the securities are classified as debt investments at amortized cost, what is the carrying amount of the debt investment reported on December 31, 2020
a) 1,000,000
b) 1,051,163
c) 1,055,000
d) 1,065,000
B) Assuming that the securities are classified as debt investments at fair value though profit or loss, what is the carrying amount of the debt investment reported on December 31, 2020 statement of financial position?
a) 1,000,000
b) 1,051,163
c) 1,055,000
d) 1,065,000
C) Assuming that the securities are classified as debt investments at fair value through profit or loss, what is the interest revenue from the bond investment for the year 2020?
a) 52,913
b) 60,000
c) 106,163
d) 120,000
D) Assuming that the securities are classified as debt investments at amortized cost, what is the interest revenue from the bond investment for the year 2020?
a) 53,250
b) 60,000
c) 120,000
d) 106,163
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