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Gratitude Company purchased 5,000, P1,000 face amount, 12% bonds to yield 10%. The carrying amour of the bonds on January 1, 2023 was P5,253,710. The bonds mature on January 1, 2026 and pay interest semi-annually on June 30 and December 31. The entity sold 3,000 bonds on August 1, 2023 for P3,240,000 after the interest has been received. What amount should be recognized as gain / (loss) on sa of bonds? a. 61,841 b. 114,080 C. 133,671 d. 190,134

Gratitude Company purchased 5,000, P1,000 face amount, 12% bonds to yield 10%. The carrying amour of the bonds on January 1, 2023 was P5,253,710. The bonds mature on January 1, 2026 and pay interest semi-annually on June 30 and December 31. The entity sold 3,000 bonds on August 1, 2023 for P3,240,000 after the interest has been received. What amount should be recognized as gain / (loss) on sa of bonds? a. 61,841 b. 114,080 C. 133,671 d. 190,134

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Gratitude Company purchased 5,000, P1,000 face amount, 12% bonds to yield 10%. The carrying amount of the bonds on January 1, 2023 was P5,253,710. The bonds mature on January 1, 2026 and pay interest semi-annually on June 30 and December 31. The entity sold 3,000 bonds on August 1, 2023 for P3,240,000 after the interest has been received. What amount should be recognized as gain / (loss) on sale of bonds? a. 61,841 b. 114,080 C. 133,671 d. 190,134
Transcribed Image Text:Gratitude Company purchased 5,000, P1,000 face amount, 12% bonds to yield 10%. The carrying amount of the bonds on January 1, 2023 was P5,253,710. The bonds mature on January 1, 2026 and pay interest semi-annually on June 30 and December 31. The entity sold 3,000 bonds on August 1, 2023 for P3,240,000 after the interest has been received. What amount should be recognized as gain / (loss) on sale of bonds? a. 61,841 b. 114,080 C. 133,671 d. 190,134
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