On January 1, 2021, PRANCER Company was authorized to issue 12% bonds with a face amount...
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On January 1, 2021, PRANCER Company was authorized to issue 12% bonds with a face amount of P5,000,000. Interest on bonds is payable semiannually on January 1 and July. Bonds mature on January 1, 2026. The entire issue was sold on February 28, 2021 at 96 including interest. Bond issue.cost amounts to P180,000. On October 1, 2023, bonds of $2,000,000 face amount were retired at 98 plus accrued interest. Requirements: 10. How much is the carrying value of the bond on December 31, 2021? 11. How much cash was paid on October 1, 2023? 12. How much is the gain or loss on retirement of bonds to be recognized on October 1, 2023? 13. How much is the remaining carrying value of the bonds on December 31, 2023? On January 1, 2021, PRANCER Company was authorized to issue 12% bonds with a face amount of P5,000,000. Interest on bonds is payable semiannually on January 1 and July. Bonds mature on January 1, 2026. The entire issue was sold on February 28, 2021 at 96 including interest. Bond issue.cost amounts to P180,000. On October 1, 2023, bonds of $2,000,000 face amount were retired at 98 plus accrued interest. Requirements: 10. How much is the carrying value of the bond on December 31, 2021? 11. How much cash was paid on October 1, 2023? 12. How much is the gain or loss on retirement of bonds to be recognized on October 1, 2023? 13. How much is the remaining carrying value of the bonds on December 31, 2023?
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Answer rating: 100% (QA)
ANSWER To solve the problems we need to compute for the following 1 The amount of bonds issued P5000000 2 The annual interest payment P5000000 x 12 P6... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0077400163
6th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
Posted Date:
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