On January 1, 2021, Peru Company purchased P5,000,000 face amount, 17% bonds. The bonds were purchased to yield 16% interest. The bonds mature on January 1, 2026, and pay interest annually on December 31. The entity used 2 decimal places for the PVF. The fair value of the bonds on December 31, 2021, is P5,250,000. The fair value of the bonds on December 31, 2022, is P5,276,500. If measured at FVPL, how much is the interest income on December 31, 2021?
On January 1, 2021, Peru Company purchased P5,000,000 face amount, 17% bonds. The bonds were purchased to yield 16% interest. The bonds mature on January 1, 2026, and pay interest annually on December 31. The entity used 2 decimal places for the PVF. The fair value of the bonds on December 31, 2021, is P5,250,000. The fair value of the bonds on December 31, 2022, is P5,276,500. If measured at FVPL, how much is the interest income on December 31, 2021?
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 1MC
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On January 1, 2021, Peru Company purchased P5,000,000 face amount, 17% bonds.
The bonds were purchased to yield 16% interest.
The bonds mature on January 1, 2026, and pay interest annually on December 31.
The entity used 2 decimal places for the PVF.
The fair value of the bonds on December 31, 2021, is P5,250,000.
The fair value of the bonds on December 31, 2022, is P5,276,500.
If measured at FVPL, how much is the interest income on December 31, 2021?
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