On December 1, 2018, the Lawrz Corporation issued five-year, non-convertible P5,000,000 face value 12% bonds for P5,386,072, a price that yields 10%. Interest is payable semi-annually on June 1 and December 1. On August 1, 2021, the Lawrz Corporation retired P3,000,000 of the bonds at 105 plus interest. The Accounting period for the Lawrz Corporation is the calendar year. What is the carrying value of the bonds retired on August 1, 2021? a. 3,125,172 b. 3,127,008 c. 3,129,355 d. 3,200,061 e. 3,122,038
On December 1, 2018, the Lawrz Corporation issued five-year, non-convertible P5,000,000 face value 12% bonds for P5,386,072, a price that yields 10%. Interest is payable semi-annually on June 1 and December 1. On August 1, 2021, the Lawrz Corporation retired P3,000,000 of the bonds at 105 plus interest. The Accounting period for the Lawrz Corporation is the calendar year. What is the carrying value of the bonds retired on August 1, 2021? a. 3,125,172 b. 3,127,008 c. 3,129,355 d. 3,200,061 e. 3,122,038
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 8RE
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On December 1, 2018, the Lawrz Corporation issued five-year, non-convertible P5,000,000 face
June 1 and December 1. On August 1, 2021, the Lawrz Corporation retired P3,000,000 of the
bonds at 105 plus interest. The Accounting period for the Lawrz Corporation is the calendar
year.
What is the carrying value of the bonds retired on August 1, 2021?
a. 3,125,172
b. 3,127,008
c. 3,129,355
d. 3,200,061
e. 3,122,038
please explain
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