On June 30, 2019, King Company had outstanding 9%, P5,000,000 face value bonds maturing on June 30, 2024. Interest is payable semiannually every June 30 and December 31. On June 30, 2019, after amortization was recorded for the period, the unamortized bond premium and bond issue cost were P30, 000 and P50, 000, respectively. On that date, King Company acquired all its outstanding bonds on the open market at 98 and retired them. On June 30, 2019, what amount should King Company recognize as gain before tax on redemption of bonds?
On June 30, 2019, King Company had outstanding 9%, P5,000,000 face value bonds maturing on June 30, 2024. Interest is payable semiannually every June 30 and December 31. On June 30, 2019, after amortization was recorded for the period, the unamortized bond premium and bond issue cost were P30, 000 and P50, 000, respectively. On that date, King Company acquired all its outstanding bonds on the open market at 98 and retired them. On June 30, 2019, what amount should King Company recognize as gain before tax on redemption of bonds?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Problem 12:
On June 30, 2019, King Company had outstanding 9%, P5,000,000 face
2024. Interest is payable semiannually every June 30 and December 31. On June 30, 2019, after amortization
was recorded for the period, the unamortized bond premium and bond issue cost were P30, 000 and P50, 000,
respectively. On that date, King Company acquired all its outstanding bonds on the open market at 98 and
retired them.
On June 30, 2019, what amount should King Company recognize as gain before tax on redemption of bonds?
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