Homework Help is Here – Start Your Trial Now!
Business
Accounting
Problem 24-30 (IAA) On January 1, 2014, Aroma Company purchased bonds with face amount of P5,000,000 for P4,766,000. The stated rate on the bonds is 10% but the bonds are acquired to yield 12%. The bonds mature at the rate of P1,000,000 annually every December 31 and the interest is payable annually also every December 31. The entity used the effective interest method of amortization. What is the carrying amount of the bond investment on December 31, 2014? 1766 0000

Problem 24-30 (IAA) On January 1, 2014, Aroma Company purchased bonds with face amount of P5,000,000 for P4,766,000. The stated rate on the bonds is 10% but the bonds are acquired to yield 12%. The bonds mature at the rate of P1,000,000 annually every December 31 and the interest is payable annually also every December 31. The entity used the effective interest method of amortization. What is the carrying amount of the bond investment on December 31, 2014? 1766 0000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

Please answer and show solution

Problem 24-30 (IAA) On January 1, 2014, Aroma Company purchased bonds with face amount of P5,000,000 for P4,766,000. The stated rate on the bonds is 10% but the bonds are acquired to yield 12% The bonds mature at the rate of P1,000,000 annually every December 31 and the interest is payable annually also December 31. The entity used the effective interest method of amortization. What is the carrying amount of the bond investment on December 31, 2014? every a. 4,766,000 b. 3,694,080 c. 4,837,920 d: 3,837,920 C.
Transcribed Image Text:Problem 24-30 (IAA) On January 1, 2014, Aroma Company purchased bonds with face amount of P5,000,000 for P4,766,000. The stated rate on the bonds is 10% but the bonds are acquired to yield 12% The bonds mature at the rate of P1,000,000 annually every December 31 and the interest is payable annually also December 31. The entity used the effective interest method of amortization. What is the carrying amount of the bond investment on December 31, 2014? every a. 4,766,000 b. 3,694,080 c. 4,837,920 d: 3,837,920 C.
Expert Solution
steps

Step by step

Solved in 4 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Database design
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS