On November 1, 2021, Mason Company issued P8,000,000 of its 10 year, 8% term bonds dated October 1, 2021. The bonds were sold to yield 10% with total proceeds of P7,000,000 plus accrued interest. Interest is paid every February 1 and August 1. Mason Company reports on a fiscal year ending every July 31 and amortizes premiums, discounts and bond issue costs using the straight line method. On July 31, 2022, what amount should be reported as bonds liability?

On November 1, 2021, Mason Company issued P8,000,000 of its 10 year, 8% term bonds dated October 1, 2021. The bonds were sold to yield 10% with total proceeds of P7,000,000 plus accrued interest. Interest is paid every February 1 and August 1. Mason Company reports on a fiscal year ending every July 31 and amortizes premiums, discounts and bond issue costs using the straight line method. On July 31, 2022, what amount should be reported as bonds liability?

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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