On January 1, 2012, One Company issued P5,000,000, 8% serial bonds, to be repaid in the amount of P1,000,000 each year. Interest is payable annually on December 31. The bonds were issued to yield 10% a year. The bond issue price was P4,757,000 based on the present value on January 1, 2012, of five annual payments. One amortizes the bond discount by the interest method. In its December 31, 2012, balance sheet, what amount should One Company report as carrying value of the bonds?
On January 1, 2012, One Company issued P5,000,000, 8% serial bonds, to be repaid in the amount of P1,000,000 each year. Interest is payable annually on December 31. The bonds were issued to yield 10% a year. The bond issue price was P4,757,000 based on the present value on January 1, 2012, of five annual payments. One amortizes the bond discount by the interest method. In its December 31, 2012, balance sheet, what amount should One Company report as carrying value of the bonds?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2012, One Company issued P5,000,000, 8% serial bonds, to be repaid in the amount of P1,000,000 each year. Interest is payable annually on December 31. The bonds were issued to yield 10% a year. The
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