On January 1, 2020, Apple Co. purchased held-for-collection and sales bonds par value $2,000,000, 9% paying $1,920,000. The bonds mature on January 1, 2025, and pay interest on July 1 and January 1. Apple Co. sells these bonds on January 1, 2023, for €2,025,000, after the interest has been received. If the carrying value of the bonds at the selling date was €1,966,500. Apple Co. uses effective interest amortization (10% effective interest rate). The gain on the sale is: 0000 A. €80,000. B. €25,000. C. €58,500. D. €33,500.

On January 1, 2020, Apple Co. purchased held-for-collection and sales bonds par value $2,000,000, 9% paying $1,920,000. The bonds mature on January 1, 2025, and pay interest on July 1 and January 1. Apple Co. sells these bonds on January 1, 2023, for €2,025,000, after the interest has been received. If the carrying value of the bonds at the selling date was €1,966,500. Apple Co. uses effective interest amortization (10% effective interest rate). The gain on the sale is: 0000 A. €80,000. B. €25,000. C. €58,500. D. €33,500.

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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