ISKO Corporation authorized the sale of P4,000,000 of 12%, 8-year debentures on January 1, 2016. Interest is payable on January 1 and July . The entire issue was sold on April 1, 2016, at 104 including accrued interest. On April 1, 2021, P2,000,000 of the bond issue was reacquired and retired at 100 plus accrued interest. On June 30, 2022, the remaining bonds were reacquired at 98 plus accrued interest and refunded with an issue of P3,200,000 of 9% bonds which were sold at 102. Based on the above and the result of your audit, determine the: (use straight line method to amortize premium or discount) Gain or loss on retirement of remaining bonds on June 30, 2022.
ISKO Corporation authorized the sale of P4,000,000 of 12%, 8-year debentures on January 1, 2016. Interest is payable on January 1 and July . The entire issue was sold on April 1, 2016, at 104 including accrued interest. On April 1, 2021, P2,000,000 of the bond issue was reacquired and retired at 100 plus accrued interest. On June 30, 2022, the remaining bonds were reacquired at 98 plus accrued interest and refunded with an issue of P3,200,000 of 9% bonds which were sold at 102. Based on the above and the result of your audit, determine the: (use straight line method to amortize premium or discount) Gain or loss on retirement of remaining bonds on June 30, 2022.
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
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 7C
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ISKO Corporation authorized the sale of P4,000,000 of 12%, 8-year debentures on January 1, 2016. Interest is payable on January 1 and July . The entire issue was sold on April 1, 2016, at 104 including accrued interest. On April 1, 2021, P2,000,000 of the bond issue was reacquired and retired at 100 plus accrued interest. On June 30, 2022, the remaining bonds were reacquired at 98 plus accrued interest and refunded with an issue of P3,200,000 of 9% bonds which were sold at 102.
Based on the above and the result of your audit, determine the: (use
Gain or loss on retirement of remaining bonds on June 30, 2022.
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