Problem 6-25 (IAA)Nixon Company reported 10% bonds payable with carryingamount of P5,700,000 on January 1, 2020. The bonds had aface amount of P6,000,000 and were issued to yield 12%.The interest method of amortization is used. Interest waspaid on January 1 and July 1 of each year.On July 1, 2020, the entity retired the bonds at 102. Theinterest paymnent on July 1, 2020 was made as scheduled.1 What is the carrying amount of the bonds payable on July.1,2020?a. 5,700,000b. 5,742,000c. 6,000,000d. 5,658,0002 What amount should be recorded as loss on the earlyextinguishent of the bonds?8. 120,000b. 378,000c. 336,000d. 462,000

Given information, 10 per cent interest on bonds payable Face amount= P6,000,000. Yield =12%

Answered: Nixon Company reported 10% bonds…

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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