On January 1, 2019, Ron Company purchased 12% bonds with face amount of P5,000,000 for P5,380,000 with an effective yield of 10%. The bonds are dated January 1, 2019, mature on January 1, 2024 and pay interest annually on December 31 of each year. The bonds are quoted at 120 on December 31, 2019. The entity has elected the fair value option for the bond investment. What total income should be reported for 2019? a. 1,220,000 b. 1,120,000 C. 1,138,000 d. 600,000
On January 1, 2019, Ron Company purchased 12% bonds with face amount of P5,000,000 for P5,380,000 with an effective yield of 10%. The bonds are dated January 1, 2019, mature on January 1, 2024 and pay interest annually on December 31 of each year. The bonds are quoted at 120 on December 31, 2019. The entity has elected the fair value option for the bond investment. What total income should be reported for 2019? a. 1,220,000 b. 1,120,000 C. 1,138,000 d. 600,000
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 1MC
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