On January 1, 2020, Trisha Company received P1,077,200 for 12% bonds with face amount of P1,000,000. The bonds were sold to yield 10%. Interest is payable semiannually every January 1 and July 1. The entity elected the fair value option for measuring financial liabilities. On December 31, 2020, the fair value of the bonds is P1,064,600. The change in fair value of the bonds is attributable to market factors.
On January 1, 2020, Trisha Company received P1,077,200 for 12% bonds with face amount of P1,000,000. The bonds were sold to yield 10%. Interest is payable semiannually every January 1 and July 1. The entity elected the fair value option for measuring financial liabilities. On December 31, 2020, the fair value of the bonds is P1,064,600. The change in fair value of the bonds is attributable to market factors.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![4. What is the carrying amount of the bonds payable on
December 31, 2020?
a. 1,064,600
b. 1,077,200
c. 1,000,000
d. 1,064,920
5. Prepare journal entries for 2020.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3b0935a7-4718-4e27-a94d-96eff32b4306%2Fa6f897b0-ef52-4855-b50f-acd9c276965b%2Fc1ixur_processed.png&w=3840&q=75)
Transcribed Image Text:4. What is the carrying amount of the bonds payable on
December 31, 2020?
a. 1,064,600
b. 1,077,200
c. 1,000,000
d. 1,064,920
5. Prepare journal entries for 2020.
![On January 1, 2020, Trisha Company received P1,077,200
for 12% bonds with face amount of P1,000,000. The bonds
were sold to yield 10%. Interest is payable semiannually
every January 1 and July 1.
The entity elected the fair value option for measuring financial
liabilities.
On December 31, 2020, the fair value of the bonds is
P1,064,600. The change in fair value of the bonds is
attributable to market factors.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3b0935a7-4718-4e27-a94d-96eff32b4306%2Fa6f897b0-ef52-4855-b50f-acd9c276965b%2Fnmletpg_processed.png&w=3840&q=75)
Transcribed Image Text:On January 1, 2020, Trisha Company received P1,077,200
for 12% bonds with face amount of P1,000,000. The bonds
were sold to yield 10%. Interest is payable semiannually
every January 1 and July 1.
The entity elected the fair value option for measuring financial
liabilities.
On December 31, 2020, the fair value of the bonds is
P1,064,600. The change in fair value of the bonds is
attributable to market factors.
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