Kim Company issued P 10,000,000 bonds on the bond issue date, December 31, 2018. The bonds pay
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Question:
Kim Company issued P 10,000,000 bonds on the bond issue date, December 31, 2018. The bonds pay interest annually at 8% on the outstanding bond balance. The face value of the ends is payable in installments of P 2,000,000 every December 31, starting December 31, 2019. The bonds were sold at a price that yields 12%.
REQUIRED: Determine the following:
a) Determine the issue price of the bonds on December 31, 2018.
b) Create an amortization table using the effective interest method.
c) Prepare entries in the books of Kim Company for years 2019 through 2021 related to the bonds.
Related Book For
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
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