Barney Company purchased 10,000, P1,000 face amount, 9% bonds to yield 10%. The carrying amount of the bonds on January 1, 2020 was P9,750,000. The bonds mature on June 30, 2023 and pay interest semiannually on June 30 and December 31. The entity sold 5,000 bonds on March 1, 2020 for 4,900,000 plus accrued interest. What amount should be recognized as gain or loss on sale of bonds? Indicate if GAIN OR LOSS.

Barney Company purchased 10,000, P1,000 face amount, 9% bonds to yield 10%. The carrying amount of the bonds on January 1, 2020 was P9,750,000. The bonds mature on June 30, 2023 and pay interest semiannually on June 30 and December 31. The entity sold 5,000 bonds on March 1, 2020 for 4,900,000 plus accrued interest. What amount should be recognized as gain or loss on sale of bonds? Indicate if GAIN OR LOSS.

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 1RE

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