Kaloy invested in the bonds of AAA Company in the United States. The bonds were issued at a price of P26,000,000 in Peso equivalent. The bonds pay 9% annual interest and matures in 4 years. Kaloy transferred the bonds at a consideration of P27,000,000 in the Philippines t
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Kaloy invested in the bonds of AAA Company in the United States. The bonds were issued at a price of P26,000,000 in Peso equivalent. The bonds pay 9% annual interest and matures in 4 years. Kaloy transferred the bonds at a consideration of P27,000,000 in the Philippines to ABM Investors. Compute the DST.
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- On Jan. 1, 20x1, Yngwei Co. purchased 6,000,000, 10% bonds issued by Malsteen, Inc. for 5,116,292. The bonds together with compounded interest are due on Dec. 31, 20x3. What is the effective interest rate on the bonds and how much is the carrying amount of the investment on Dec. 31, 20x2? a. 18% ; 7,897,017. c. 16% ; 6,884,483 b. 16% ; 5,624,483. d. 8%; 4,928,774Entity A is a listed company in Hong Kong for more than 20 years. Its business mainly focuses on the food industry. On 1 January 2016, Entity A invested in a bond with a face value of $8,500,000 and it pays a fixed interest of 6.00% for the first two years, then 9.25% fixed interest for the last two years. The fair value of the bond is $8,350,000 and the transaction cost for purchasing the bond is $53,523. Entity A made the payment to the issuer for the purchase of the bond by a cheque. The bond was planned to hold until maturity. The fair value option in measurement was not adopted. Interest is paid in arrears annually. The bond will be redeemed at a premium of 20% after 4 years. The effective rate for this bond is 12.00%. The 12-month expected credit loss and lifetime expected credit loss was initially estimated at $19,500 and $61,500 respectively. On 31 December 2016, there was no significant change in credit risk. The 12-month expected credit loss and lifetime expected…Peter Company purchased bonds at a discount of P5,000,000. Subsequently, Peter sold these bonds at a premium of P2,000,000. During the period that Peter held this investment, amortization of the discount amounted to P1,500,000. What amount should Peter report as gain on the sale of the bonds?
- PT ABC issues bonds with a term of 5 years, with a value of. nominal amount of Rp. 1,000,000.00 each sheet. The interest offered in the issuance of bonds is 6.25% per annum. The selling price of the bonds is Rp. 935,000.00 each with a tax rate of 15%. Calculate the cost of capital of the bond!On 1 July 2021, Jill Ltd acquired some corporate bonds issued by Soy Ltd • These bonds cost $1 038 870. They had a ‘face value’ of $1 million and offered a coupon rate of 10 per cent paid annually ($100 000 per year, paid on 30 June). The bonds would repay the principal of $1 million on 30 June 2026 • At the time the market only required a rate of return on 9 per cent on such bonds • Jill Ltd operates within a business model where government bonds are held in order to collect contractual cash flows and there is no intention to trade them • Assume that there were no direct costs associated with acquiring the bonds Based on the above information, calculate the amortised cost of the bonds as at30 June 2022, 2023, 2024, 2025 and 2026MK Limited has invested in a debt instrument, details of which are as follows: Face Value=10,000 Premium paid on the investment of the instrument =800 Transaction cost paid on the investment of the instrument =200 Coupon rate of the Instrument =12% Term of the instrument = 4 yearsMK Limited has a policy to classify Investment in debt instruments at Amortized Cost.IRR of the debt Instrument is 8.9188%Required Prepare the relevant entries for the whole tenure.
- On August 1, 2001, AS DRE acquired the bonds, paying 940,000 euros. The nominal value of the acquired bonds is 1,000,000 euros. The nominal interest rate of the bonds is 9% and the real interest rate is 10%. Interest will be paid in February and 1 August). AS DRE intends to hold the bonds twice a year until maturity. What is the value of the acquired bonds in the statement of financial position (balance sheet) of AS DRE as of 31 December 2001?Described below are certain transactions of Jeno Corporation during 2022. 1. On April 1, the corporation bought a truck for P6,000,000 from Haechan Corporation, payingP1,000,000 in cash and signing a one year, 12% note for the balance of the purchase price. 2. On May 1, the corporation received proceeds of P18,760,000 from Jisung Bank by signing a 10% note payable in equal annual installments of P2,000,000. The payment is to apply first to interest and then to principal. The first installment is due or April 30, 2023.3. On August 1, the Board of Directors declared a P300,000 cash dividend that was payable on September 10, to shareholders of record on August 31.4. On December 15, the corporation purchased goods from Chenle Company for P1,500,000 subjectto cash discount terms 2/10, n/30. Purchases and accounts payable are recorded by the corporation at net amounts after cash discounts. The invoice was paid on January 14, 2023.5. Sales during the month of December amounted to P6,832,000,…Entity A is a toy manufacturer in Hong Kong which commenced its business more than thirty years. On 1 January 2017, Entity A bought a $2,000,000 5.00% bond for $1,900,000. It also incurred an issue cost of $50,000. Entity A paid the bond price by a direct bank transfer on 1 January 2017. The issue cost was settled on 31 January 2017. Fixed interest is received in arrears. The bond will be redeemed at a premium of $119,201 over its face value on 31 December 2019. Entity A may sell the bond if the bond price is attractive or for any other reason determined by the board of directors. The fair value option was not elected at the initial recognition. The fair values of the bond were as follows: 31 December 2017 $2,200,000 31 December 2018 $2,080,000 31 May 2019 $2,250,000 30 June 2019 $2,350,000 31 December 2019 $2,500,000 Due to the cash shortage, Entity A did not prefer to hold the bond until maturity. On 31 May 2019, the board of…
- On January 1, 20X2, Tanangonan Company acquired all the assets and assumed all the liabilities of Ong Company. In exchange for the net assets of Ong, Tanangonan gave its bond payable with a maturity value of P600,000 with a stated rate of 10% interest payable semiannually on June 30 and December 31. The said bond will also mature on January 1, 20X2, and has a yield rate of 12%. Required:1. Determine the goodwill or gain on bargain purchase from the above acquisition.2. Give the adjusting entries that will be made on the book of Tanangonan. 3. Prepare the Statement of Financial Position (SFP) of Tanangonan after the merger. see the given picture for The Statement of Financial Position (SFP) of both companies as of January 1, 20X2 were as follows:SenjaKala Bhd is an investment holding company that involves in property and township development, construction, road building and maintenance, tourism, leisure, and hospitality. In 2020, the company issued new bonds, Anugerah Bond and Kurnia Bond to raise the capital. On 1 April 2020, the company issued Anugerah Bond, 12% RM500,000 dated 1 January 2020 to yield 10% interest at the price of RM523,516. The bond matures in 3 years and the interest payments are made semi-annually, 1 July and 1 January each year. On 1 July 2020, the company issued Kurnia Bond with a par value of RM1,000,000, which mature in five years. The coupon rate is 6% with an effective yield of 8%. The interest is payable annually on 30 June. The company uses the effective interest method to amortize bond premium or discount. The financial year end of the company is on 31 December. REQUIRED: (Round your answer to the nearest RM) Prepare a bond amortisation schedule for Anugerah Bond up to 1 July 2021.…Cronan, Inc., sells $1,000,000 general obligation bonds for 98. The interest rate on the bonds, paidquarterly, is 6 percent. Calculate (a) the amount that the company will actually receive from thesale of the bonds, and (b) the amount of both the quarterly and the total annual cash interest thatthe company will be required to pay.