(AICPA Adapted) M the beginning of the eurrent vear, Ceve Compan, donely-held entity, iaued ON bonde with a maturity value P6.000.000, together with 10.000 rinary shares of P50 par value, for a combined caah amount of PIL000.000. Probiem If insed separately, the bende would have old for P4000.000 on an 8% yield to maturity besia 1 What amount of the proceeds ahould be allocated to the ordinary shares 4,000,000 A 7,000,000 8,000,000 d. 5,000.000 2 What amount should be reported for share premium on the issuance of the ordinary shares? 7,500.000 6,500,000 e 5,500,000 4.300.000
(AICPA Adapted) M the beginning of the eurrent vear, Ceve Compan, donely-held entity, iaued ON bonde with a maturity value P6.000.000, together with 10.000 rinary shares of P50 par value, for a combined caah amount of PIL000.000. Probiem If insed separately, the bende would have old for P4000.000 on an 8% yield to maturity besia 1 What amount of the proceeds ahould be allocated to the ordinary shares 4,000,000 A 7,000,000 8,000,000 d. 5,000.000 2 What amount should be reported for share premium on the issuance of the ordinary shares? 7,500.000 6,500,000 e 5,500,000 4.300.000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 12
Transcribed Image Text:Problem 20-12 (AICPA Adapted)
At the beginning of the current year, Cove Company,
doely-held entity, issued ON bonda with a maturity value
of P6,000,000, together with 10,000 ordinary shares of P50
par value, for a combined eash amount of PIL.000.000.
If iasued separately, the bonda would have sold for
P4,000,000 on an 8% yield to maturity basia
1 What amount of the proceeda should be allocated to
the ordinary shares?
a. 4.000,000
b. 7,000,000
8,000,000
d. 5,000,000
2 What amount should be reported for share premium
on the issuance of the ordinary sharee?
A 7,600,000
b6,500,000
e. 5,500,000
d. 4.300,000
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