On January 1, 2019, Pancit Company purchased Canton Corporation, P1,000,000, 12% bonds for P1,065,000, a price that yields 10%. The bonds pay interest semi-annually every January 1 and July 1 and they mature on January 1, 2023. At December 31, 2019, each P1,000 bond is selling at P1,055. Assuming that the securities are classified as debt investments at fair value through profit or loss, what is the carrying amount of the debt investment reported on December 31, 2019 statement of financial position? A. P1,065,000 B. P1,055,000 C. P1,051,163 D. P1,000,000
On January 1, 2019, Pancit Company purchased Canton Corporation, P1,000,000, 12% bonds for P1,065,000, a price that yields 10%. The bonds pay interest semi-annually every January 1 and July 1 and they mature on January 1, 2023. At December 31, 2019, each P1,000 bond is selling at P1,055. Assuming that the securities are classified as debt investments at fair value through profit or loss, what is the carrying amount of the debt investment reported on December 31, 2019 statement of financial position? A. P1,065,000 B. P1,055,000 C. P1,051,163 D. P1,000,000
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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On January 1, 2019, Pancit Company purchased Canton Corporation, P1,000,000, 12% bonds for P1,065,000, a price that yields 10%. The bonds pay interest semi-annually every January 1 and July 1 and they mature on January 1, 2023. At December 31, 2019, each P1,000 bond is selling at P1,055.
Assuming that the securities are classified as debt investments at fair value through profit or loss, what is the carrying amount of the debt investment reported on December 31, 2019
A. P1,065,000
B. P1,055,000
C. P1,051,163
D. P1,000,000
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