Answer number 2

The fair values at December 31, 20 Peach Company bonds Buttercup Corp bonds are as follows: 99% 102% Required: Give all entries during 2020 including adjusting entries at December 31,2020. Provide the carrying value of all securities as of December 31, 2020 2. On January 1, Year 1 Naruto Company purchased P100,000 face value 5 year bond of Wolf Corp for P108,660, a price that yields 5pct on a stated interest rate of 7 pct. Interest is payable annually at Dec 31. The bond investment is measured at amortized cost. On Dec 31, Year 3 after paying the periodic interest, Naruto negotiated for a modification of interest from 7 pct to 4.5 pct for the remaining term of the bonds due to continuous decline in the market rate of interest. On this date, Naruto Company had an allowance for expected credit losses relating to this investment in the amount of P1,500 after previously applying Stages 1 and 2 of the ECL model. Required: Give all entries in the books of Naruto for Years 1 to 4 as a result of the foregoing