please help me understand this problem. the photos attached has the question and answer already I just need to know where the numbers came from and how it is the answer Ruby Corp. is authorized to issue P 5,000,000 of 5- year bonds dated June 30,2018 with a stated interest rate of10%. Interest on the bonds is payable semi-annually on June 30 and December 31. The company uses theeffective interest method of amortization. The bonds were sold to yield (a) 8%; (b) 12%.REQUIRED: Complete the table below.(а) 8%(b) 1 2%Bonds issue priceNominal interest for 2018Interest Expense (Effective interest) for 2018Premium/ discount amortization in 2018Bond carrying value at December 31,2018Nominal interest for 2019Interest Expense for 2019Premium/discount amortization in 2019Bond carrying value at December 31,2019 (Ruby Corporation)At 8%5,405,725250,000216,22933,7715,371,954500,000428,35171,6495,300,305At 12%4,632,025250,000277,92227,9224,659,947500,000560,97060,9704,720,917Bond issue priceNominal interest for 2018Interest expense (Effective interest) for 2018Premium/discount amortization in 2018Bond carrying value at December 31, 2019Nominal interest for 2019Interest expense for 2019Premium/discount amortization in 2019Bond carrying value at December 31, 2019Computations:At 8%:Issue price = (5,000,000 x 0.6756) + (250,000 x 8.1109)= 3,378,000 + 2,027,725 = 5,405,725InterestInterestPremiumBondDate06/30/1812/31/1806/30/1912/31/19Carrying Value5,405,7255,371,9545,336,8325,300,305PaidExpenseAmortization250,000250,000250,000216,229214,878213,47333,77135,12236,52765er 5- Financial LiabilitiesAt 12%:Issue price = (5,000,000 x 0.5584) + (250,000 x 7.3601)= 2,792,000 + 1,840,025 = 4,632,025

This question is based on the fair valuation/measurement of financial liabilities. Here Present…

Ruby Corp. is authorized to issue P 5,000,000 of 5- year bonds dated June 30,2018 with a stated interest rate of 10%. Interest on the bonds is payable semi-annually on June 30 and December 31. The company uses the effective interest method of amortization. The bonds were sold to yield (a) 8%; (b) 12%. REQUIRED: Complete the table below. (a) 8% (b) 12% Bonds issue price Nominal interest for 2018 Interest Expense (Effective interest) for 2018 Premium/ discount amortization in 2018

Ruby Corp. is authorized to issue P 5,000,000 of 5- year bonds dated June 30,2018 with a stated interest rate of 10%. Interest on the bonds is payable semi-annually on June 30 and December 31. The company uses the effective interest method of amortization. The bonds were sold to yield (a) 8%; (b) 12%. REQUIRED: Complete the table below. (a) 8% (b) 12% Bonds issue price Nominal interest for 2018 Interest Expense (Effective interest) for 2018 Premium/ discount amortization in 2018

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 14MC: Whirlie Inc. issued $300,000 face value, 10% paid annually, 10-year bonds for $319,251 when the...

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