On July 1, 2003, New York Company purchased, as investment measured at amortized cost, P1,000,000 of Park, Inc.’s 8% bonds for P946,000, including accrued interest of P40,000. The bonds were purchased to yield 10% interest. The bonds mature on January 1, 2010 and pay interest annually on January 1. York uses the effective interest method of amortization. In its December 31, 2003 balance sheet, what amount should York report as investment in bonds? a. 911,300 b. 916,600 c. 953,300 d. 960,600
On July 1, 2003, New York Company purchased, as investment measured at amortized cost, P1,000,000 of Park, Inc.’s 8% bonds for P946,000, including accrued interest of P40,000. The bonds were purchased to yield 10% interest. The bonds mature on January 1, 2010 and pay interest annually on January 1. York uses the effective interest method of amortization. In its December 31, 2003 balance sheet, what amount should York report as investment in bonds? a. 911,300 b. 916,600 c. 953,300 d. 960,600
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 July 1, 2003, New York Company purchased, as investment measured at amortized cost, P1,000,000 of Park, Inc.’s 8% bonds for P946,000, including accrued interest of P40,000. The bonds were purchased to yield 10% interest. The bonds mature on January 1, 2010 and pay interest annually on January 1. York uses the effective interest method of amortization. In its December 31, 2003 balance sheet, what amount should York report as investment in bonds?
a. 911,300
b. 916,600
c. 953,300
d. 960,600
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