On August 1, 2021, Excel Company purchased at par P5million bonds with stated interest rate of 12% payable semi-annually on March 1 and September 1. The total payments made for the purchase amounted to P5,200,000. The best explanation for the excess amount paid over par value is that a.) the bonds were purchased at a premium b.) the bonds were purchased at a discount plus accrued interest c.) the bonds were purchased at par plus accrued interest d.) the bonds were purchased at a premium less accrued interest
On August 1, 2021, Excel Company purchased at par P5million bonds with stated interest rate of 12% payable semi-annually on March 1 and September 1. The total payments made for the purchase amounted to P5,200,000. The best explanation for the excess amount paid over par value is that a.) the bonds were purchased at a premium b.) the bonds were purchased at a discount plus accrued interest c.) the bonds were purchased at par plus accrued interest d.) the bonds were purchased at a premium less accrued interest
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 4EA: On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated...
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On August 1, 2021, Excel Company purchased at par P5million bonds with stated interest rate of 12% payable semi-annually on March 1 and September 1. The total payments made for the purchase amounted to P5,200,000. The best explanation for the excess amount paid over par value is that
a.) the bonds were purchased at a premium
b.) the bonds were purchased at a discount plus accrued interest
c.) the bonds were purchased at par plus accrued interest
d.) the bonds were purchased at a premium less accrued interest
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