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Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On July 1, 2002, Durable Company purchased
Rose Corporation 10-year, 12% bonds with face
value of P300,000 for P324,000, which included
P12,000 of accrued interest. The bonds, which
mature on March 1, 2009, pay interest
semi-annually on March 1 and September 1.
Durable appropriately uses the straight line
method of amortization. The amount of income
Durable should report for the calendar year 2002
as a result of this long-term investment?
P16,200
P17,100
P18,000
P30,000
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