Fiber Company has a note payable to Philippine National Bank of P8,000,000. Thenote bears interest of 12%.As a result of a settlement on December 31, 2020, Philippine National Bank agreedto the following restructuring arrangement:• Extended the maturity date to December 31, 2022.• Annual interest of 10% is to be paid on December 31, 2021 and 2022Note: Round off present value into four decimal places.How much is the gain or loss on extinguishment of debt to be recorded in thestatement of comprehensive income?344 16C

Concept of interest bearing Note Extinguishment of Loan and interest

ars interest of 12%. sult of a settlement on December 31, 2020, Philippine National Bank ag ollowing restructuring arrangement: ended the maturity date to December 31, 2022. ual interest of 10% is to be paid on December 31, 2021 and 2022

ars interest of 12%. sult of a settlement on December 31, 2020, Philippine National Bank ag ollowing restructuring arrangement: ended the maturity date to December 31, 2022. ual interest of 10% is to be paid on December 31, 2021 and 2022

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On January 1, 2021, Jackie Company issued 2,000 P5,000 8% five-year bonds at 90.35 when the market rate is 11%. Interest is payable every January 1 and July 1 starting 2021. 1. How much is the discount amortization during 2024?2. How much is the unamortized discount as of July 1, 2025?
None
INVESTMENT AT AMORTIZED COST CASE III: On January 1, 2026, ABC purchased 9% bonds with a face amount of P4M to yield 10%. The bonds are dated January 1, 2026, 2024, mature on December 31, 2035 and pay interest annually on December 31. The entity used the interest method. What should be reported as interest revenue for 2026?
On January 1, 2018, Company X is holding $10,000,000, 5% fixed-rate debt which matures in 4 years. To hedge this debt, Company X enters into a 4-year interest rate swap to receive 5% and pay LIBOR on a notional of $10,000,000. Settlement and rate reset is each December 31. The following information is available: DATE LIBOR FMV of Swap Jan. 1, 2018 5% Dec. 31, 2018 4.7% $81,450 Dec. 31, 2019 5.8% ($147,300) In an orderly manner, prepare the appropriate entries for the interest payment, swap settlement (if applicable) and necessary adjustments for 2018 and 2019. HTML
20
Current Attempt in Progress A company issues $15800000, 5.8 %, 20-year bonds to yield 6% on January 1, 2019. Interest is paid on June 30 and December 31. The proceeds from the bonds are $15434787. Using straight-line amortization, what is the carrying value of the bonds on December 31, 2021? O $15489569 O $15697393 O $15467301 O $15494599
8% annually every December 31 with a 10% effective yield. with face amount of P2,000,000 for P1,900,500 including The bonds mature on December 31, 2021 and pay interest of transaction cost of P100,500 to be held as financial aasets a On January 1, 2019, Charisma Company purchased bonda PROBLEMS Problem 20-1 (IFRS) amortized cost. 8% annually every December 31 with a 10% effective wel Required: 1. Prepare a table of amortization of the discount. 2. Prepare journal entries for 2019, 2020 and 2021.
Good Company has an overdue 8% notes payable to Better Company amounting to P8million and accrued interest for one year of P640,000. as a result of restructuring agreement on January 1, 2021, both parties agreed to the following provisions:* the principal obligation is reduced to P7,000,000* the accrued interest is forgiven* the date of maturity is extended to December 31, 2024* annual interest of 10% is to be paid in 4 years every December 31The prevailing rate of interest remained at 8%. The PV of 1 at 8% for 4 periods is 0.735 and the PV of an ordinary annuity of 1 at 8% for 4 periods is 3.31. How much is the gain on debt restructuring? a. P1,640,000 b. P1,178,000 c. P1,000,000 d. P538,000
INVESTMENT AT AMORTIZED COST CASE IV: On January 1, 2026, ABC purchased serial bonds with face amount of P5M and stated interest at 12%. The stated interest is payable annually on December 31. The bonds are acquired to have an effective yield at 10%. The bonds mature at annual installment of P1,250,000 every December 31. What is the market price of the serial bonds on the acquisition date?
Required Information On January 1, 2024, Avalanche Corporation borrowed $102,000 from First Bank by issuing a two-year, 8% fixed-rate note with annual interest payments. The principal of the note is due on December 31, 2025. • Avalanche wanted to hedge against declines in general interest rates, so it also entered into a two-year SOFR-based interest rate swap agreement on January 1, 2024, and designates it as a fair value hedge. Because the swap is entered at market rates, the fair value of the swap is zero at inception. • The agreement called for the company to receive fixed interest at the current SOFR swap rate of 5% and pay floating interest tied to SOFR. This arrangement results in an effective variable rate on the note of SOFR + 3%. • The contract specifies that the floating rate resets each year on June 30 and December 31 for the net settlement that is due the following period. In other words, the net cash settlement is calculated using beginning-of-period rates. The SOFR rates…
A 12% P1,000,000 face value bond with interest payable June 30 and December 31, which matures on June 30, 2026, was purchased at 95 for short term investment purposes on June 30, 2021. At the end of December 31, 2021, the bonds were quoted at 110. By June 30, 2022, all the bonds were sold at 115. How much would be the total cash that would be received by June 30, 2022? 1,000,000 1,100,000 O 1,150,000 O 1,210,000