on December 31, 2023 and carry a 13% interest rate. Interest is receivable annually on December 31. The bonds were initially recorded at amortized cost. On June 30, 2020, one-half of the bonds were sold for P1,595,000 plus accrued interest. After the disposal, the company changed its business model for managing its financial assets and is now actively trading its portfolio. At December 31, 2020, the bonds were quoted at 101. What is the gain on the sale of the bond investment? A. P95,000 B. P54,291 C. P49,250 D. P41,000
on December 31, 2023 and carry a 13% interest rate. Interest is receivable annually on December 31. The bonds were initially recorded at amortized cost. On June 30, 2020, one-half of the bonds were sold for P1,595,000 plus accrued interest. After the disposal, the company changed its business model for managing its financial assets and is now actively trading its portfolio. At December 31, 2020, the bonds were quoted at 101. What is the gain on the sale of the bond investment? A. P95,000 B. P54,291 C. P49,250 D. P41,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
On January 1, 2019, Caldereta Company purchased bonds with a face value of P3,000,000 for P3,108,000 to yield
12%. The bonds are due on December 31, 2023 and carry a 13% interest rate. Interest is receivable annually on December 31. The bonds were initially recorded at amortized cost. On June 30, 2020, one-half of the bonds were sold for P1,595,000 plus accrued interest. After the disposal, the
company changed its business model for managing its financial assets and is now actively trading its portfolio. At December 31, 2020, the bonds were quoted at 101.
What is the gain on the sale of the bond investment?
A. P95,000
B. P54,291
C. P49,250
D. P41,000
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