On Jan. 1, 2021, ABC bought serial bonds with a face value of P2,400,000 for P2,160,000 cash. The investment will be accounted for as a financial asset at amortized cost. It will be paid in installments of P800,000 plus 10% interest on the outstanding balance every Dec. 31, 2021. On Dec. 31, 2021, the remaining bonds have a fair value of P1,550,000. What are the amounts of the following? Use good accounting form. a. Investment in Bonds as of acquisition b. Interest income for the year c. Unrealized Holding Gain/Loss through P/L for year 2021 d. Investment in Bonds as of Dec. 31, 2021
On Jan. 1, 2021, ABC bought serial bonds with a face value of P2,400,000 for P2,160,000 cash. The investment will be accounted for as a financial asset at amortized cost. It will be paid in installments of P800,000 plus 10% interest on the outstanding balance every Dec. 31, 2021. On Dec. 31, 2021, the remaining bonds have a fair value of P1,550,000. What are the amounts of the following? Use good accounting form. a. Investment in Bonds as of acquisition b. Interest income for the year c. Unrealized Holding Gain/Loss through P/L for year 2021 d. Investment in Bonds as of Dec. 31, 2021
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On Jan. 1, 2021, ABC bought serial bonds with a face value of
P2,400,000 for P2,160,000 cash. The investment will be accounted
for as a financial asset at amortized cost. It will be paid in
installments of P800,000 plus 10% interest on the outstanding
balance every Dec. 31, 2021. On Dec. 31, 2021, the remaining bonds
have a fair value of P1,550,000.
What are the amounts of the following? Use good accounting form.
a. Investment in Bonds as of acquisition
b. Interest income for the year
c. Unrealized Holding Gain/Loss through P/L for year 2021
d. Investment in Bonds as of Dec. 31, 2021
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