On January 1, 20x4, Mondragon Company purchased bonds with face value of P5,000,000 at a cost of P4,700,000 to be held as financial asset at amortized cost. The stated interest is 10% payable annually every December 31. The bonds mature in 4 years on January 1, 2018. 1. What amount of interest income should be reported for the year ended December 31, 2014 under the effective interest method? a. 564,000 b. 470,000 c. 517,000 d. 562,590 2. What is the effective rate that is used to compute the interest income? a. 12.00% b. 10.34% c. 11.97% d. 11.00%

Q: On January 1, 2021, Kaye Ltd. purchased $250,000 of Danford Co.'s 4%, 8-year bonds.  The market rate…

A: Under Effective Interest Rate Method , Interest Income/Expense will be recognized at Market Rate.

Q: How much will be the gain (loss) on sale assuming all the bonds were sold on June 30,2020 at 99 plus…

A: Calculating carrying value of the bond on June 30, 2020. Year Beginning carrying value of bond…

Q: Garland Company received proceeds of $131600 on 10-year, 6% bonds issued on January 1, 2018. The…

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A: disclaimer:-“Since you have posted a question with multiple sub-parts, we will solve first three…

Q: 9. on July 1, 2018, Joalin Company purchased Heyoon Company ten-year, 8% bonds with a face amount of…

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Q: On January 1, 2021, Ruzak Co. sold five-year, 6% bonds with a face value of $700,000.  Interest is…

A:

Q: On February 1, 2018, Cromley Motor Products issued 9% bonds, dated February 1, with a face amount of…

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Q: Q1. What is the carrying value of the bonds on December 31, 2019? a. 5,306,515 b. 5,309,000 c.…

A: Under the Effective interest method, the premium on the issue of bonds shall be written off over the…

Q: On July 1, 2022, RED TV Company purchased 1,000 of the P1000 face value, 8% bonds for P910,000 plus…

A: It has been given that the bond is held for trading activities. Hence at year-end, the investment is…

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A: A bond is the long-term debt of an entity. The bonds are paid in more than one year. The bonds…

Q: On December 31, 2020, Fame Company sold a 12% serial bond issue with face amount of P7,000,000 for…

A: Bond Payable The main sources of generation liquidity into the business entity to raise the issue of…

Q: On January 1, 2018, lab Co. acquired P4,000,000 of 12% face value bonds at P3,767,000 to be held…

A: Face value of bond, on January 1, 2018 = P 4,000,000 Carrying value of bond on January 1, 2018 = P…

Q: Cramer Company sold 5-year, 8% bonds on October 1, 2011. The face amount of the bonds was $100,000,…

A: Interest expense = Interest accrued - Amortization of premium where, Accrued interest = Face value…

Q: On January 1, 2018, Reese Incorporated issued bonds with a face value of $120,000, a stated rate of…

A:

Q: Megan, Inc., sold $500,000 of its 9%, five-year bonds dated January 1, 2018, on May 1, 2018, for…

A: Bonds are considered a financial instrument used to raise finance for the organization. It is also…

Q: On January 2,2019, Silver Company invested in a 4-year 10% bond with a face value of $3,000,000 in…

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Q: On August 1, 2021, Excel Company purchased at par P5million bonds with stated interest rate of 12%…

A: Lets understand the basics. We all know that bond can be purchased at the issue time or at mid of…

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A: Carrying amount of the bond = Present value of principal + Present value of interest payments where,…

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A: Bonds payable is a liability account that holds the amount that the issuer owes to bondholders.…

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A: Investment is the amount which is spent by the producer for the purchase of those goods which…

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A: Ending balance of Bond Investment = Beginning Balance + Interest Accrued at Effective rate -…

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A: Hello. Since your question has multiple sub-parts, we will solve the first three sub-parts for you.…

Q: On January 1, 2018, LAB Co. acquired P4,000,000 of 12% face value bonds at P3,767,000 to be held…

A: If a company buys a financial instrument for $150,000 that has a face amount of $200,000 and which…

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A: Carrying amount of the bond = Present value of principal + Present value of interest payments where,…

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A: When bond of other entity is purchased as an investment, it can be reported on the balance sheet…

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A: Introduction:- A bond is a document of the bond issuer's obligation to the bondholders. Municipal…

Q: On October 1, 2010, EEE Inc. issued, at 101 plus accrued interest, 800 of its 10 percent, P1,000…

A: In the given case - P1000 Bonds are dated 1st July-2010. The bonds are issued on 1st October-2010…

Q: On June 1, 2019, YODA CORP. acquired a 5-year, 10%, P1,000,000 face value bonds at 92. The company…

A: Large organization uses the bonds as a fund raising tool which offers a fixed interest rate to the…

Q: On June 1, 2019, YODA CORP. acquired a 5-year, 10%, P1,000,000 face value bonds at 92. The company…

A: The amount of interest due on bonds or debentures is known as interest receivebles. The calculation…

Q: On January 2, 2012, Tamarisk Corporation issued $1,650,000 of 10% bonds at 96 due December 31, 2021.…

A: First step is to compute the total discount on the issue of bonds on jan 2012.This will be computed…

Q: On January 1, Year 1 Narito Company purchased a P100,000 face value 5-year bond of Wolf Corporation…

A: SOLUTION- Bond: When the company needs money, the company issues fixed-income security that the…

Q: On January 1, 2019, Hyde Corporation purchased bonds with a face value of $300,000 for $308,373.53.…

A: A journal entry is used to document any commercial transaction in the accounting records of a…

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A: Bonds are a form of debt or loan issued by the company, on which company has to make regular…

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A: Answer: Bonds are the debt instruments issued by the company to the general public to raise funds…

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A: Total discount = Face value of bonds - Proceeds from bonds = $200000 - 188500 = $11,500 Straight…

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A: Hello. Since your question has multiple sub-parts, we will solve the first three sub-parts for you.…

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A: A bond is a debt instrument issued by large businesses and government organizations to raise debt…

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A: Bond discount is the amount by which the selling price (or issue price or market price) of the bond…

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A: Solution- Face Value of the bonds = $200,000  Issue Price of the bonds = face value x 103% = 200,000…

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A: Bond conversion refers to the procedure of converting a bond into stock. It is entirely dependent on…

Q: On June 1, 2017, HIJ Company purchased bonds with a face amount of 3,000,000 to be held to maturity.…

A: Bond Amortization Table It  is the  table  which shows the amount of interest expense/revenue,…

Q: On

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A: An asset that is worth less than its book or net carrying value is considered impaired. In other…

Q: ell Company received proceeds of $188,000 on 10-year, 6% bonds issued on January 1, 2018. The bonds…

A: Bonds- Bonds are the written debt of the company on which interest is paid at a predetermined rate…

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A: NOTE : As per BARTLEBY guidelines, when multiple questions are given then first question is to be…

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A: Effective interest rate method of amortization is a process of amortizing premium on bond or…

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A: Financial asset held for earning contractual cash flow and to held the asset till maturity, is…

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A: Carrying value of a bond refers to the net final value computed between the bond's face value adding…