On July 1, 2020, an interest date, P1,000,000 of Siomai Company bonds were converted into 20,000 of Siomai Company’s ordinary share, each having a par value of P40 and a market value of P55. There is P40,000 unamortized discount on the bonds and P25,000 paid in capital arising from bond conversion privilege. What amount of gain or loss should Siomai Company recognize in 2016 as a result of the conversion? A. 300,000 B. 185,000 C. 160,000 D. 0
On July 1, 2020, an interest date, P1,000,000 of Siomai Company bonds were converted into 20,000 of Siomai Company’s ordinary share, each having a par value of P40 and a market value of P55. There is P40,000 unamortized discount on the bonds and P25,000 paid in capital arising from bond conversion privilege. What amount of gain or loss should Siomai Company recognize in 2016 as a result of the conversion? A. 300,000 B. 185,000 C. 160,000 D. 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
On July 1, 2020, an interest date, P1,000,000 of Siomai Company bonds were converted into 20,000 of Siomai Company’s ordinary share, each having a par value of P40 and a market value of P55. There is P40,000 unamortized discount on the bonds and P25,000 paid in capital arising from bond conversion privilege. What amount of gain or loss should Siomai Company recognize in 2016 as a result of the conversion?
A. 300,000
B. 185,000
C. 160,000
D. 0
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