On January 1, 2020, Davao Company issued 6% bonds with 3. What is the carrying amount of the bonds payable on price that yields 8%. Interest is payable annually every Problem 5-22 (AICPA Adapted) face amount of P4,000,000 for net proceeds of P3,677,600.. December 31. The entity elected the fair value option. On December 31. 2020, the bonds are quoted at 95. 1. What amount should be reported as interest expense for 2020? a. 240,000 b. 120,000 c. 294,208 d. 220,656 2. What amount should be reported as gain or loss from change in fair value for 2020? a. 322,400 gain b. 322,400 loss c. 122,400 gain d. 122,400 loss December 31, 2020?. a. 3,677,600 b. 3,800,000 c. 3,493,720 d. 4,000,000
On January 1, 2020, Davao Company issued 6% bonds with 3. What is the carrying amount of the bonds payable on price that yields 8%. Interest is payable annually every Problem 5-22 (AICPA Adapted) face amount of P4,000,000 for net proceeds of P3,677,600.. December 31. The entity elected the fair value option. On December 31. 2020, the bonds are quoted at 95. 1. What amount should be reported as interest expense for 2020? a. 240,000 b. 120,000 c. 294,208 d. 220,656 2. What amount should be reported as gain or loss from change in fair value for 2020? a. 322,400 gain b. 322,400 loss c. 122,400 gain d. 122,400 loss December 31, 2020?. a. 3,677,600 b. 3,800,000 c. 3,493,720 d. 4,000,000
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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Transcribed Image Text:On January 1, 2020, Davao Company issued 6% bonds with
3. What is the carrying amount of the bonds payable on
Problem 5-22 (AICPA Adapted)
face amount of P4,000,000 for net proceeds of P3,677,600, a
price that yields 8%. Interest is payable annually every
December 31.
The entity elected the fair value option. On December 31.
2020, the bonds are quoted at 95.
1. What amount should be reported as interest expense for
2020?
a. 240,000
b. 120,000
c. 294,208
d. 220,656
2. What amount should be reported as gain or loss from
change in fair value for 2020?
a. 322,400 gain
b. 322,400 loss
c. 122,400 gain
d. 122,400 loss
December 31, 2020?.
a. 3,677,600
b. 3,800,000
c. 3,493,720
d. 4,000,000
4. Prepare journal entries for 2020.
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