On January 1, 2021, Masbate Company issued 5-year bonds with face amount of P5,000,000 at 110. The entity paid bond issue cost of P80,000 on same date. The stated interest rate on the bonds is 8% payable annually every December 31. The bonds are issued to yield 6% per annum. The entity used the effective interest method of amortization. On December 31, 2021, wha
On January 1, 2021, Masbate Company issued 5-year bonds with face amount of P5,000,000 at 110. The entity paid bond issue cost of P80,000 on same date. The stated interest rate on the bonds is 8% payable annually every December 31. The bonds are issued to yield 6% per annum. The entity used the effective interest method of amortization. On December 31, 2021, wha
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2021, Masbate Company issued 5-year bonds with face amount of P5,000,000 at 110. The entity paid bond issue cost of P80,000 on same date. The stated interest rate on the bonds is 8% payable annually every December 31. The bonds are issued to yield 6% per annum. The entity used the effective interest method of amortization. On December 31, 2021, what is the carrying amount of the bonds payable?
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