Question
On January 1, 2020, Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including brokers commission of P20,000). Interest is payable annually every December 31. The
On January 1, 2020, Alaska Corporation purchased P1,000,000 10% bonds for P1,051,510 (including brokers commission of P20,000). Interest is payable annually every December 31. The bonds mature on December 31, 2022. The prevailing market rate for the bonds is 9% at December 31, 2020.
Which statement is correct if the bonds are classified as FA Fair Value through Other Comprehensive Income?
a. The amount to be recognized in 2020 profit or loss is P100,000.
b. The amount to be recognized in 2020 other comprehensive income is P33,900.
c. The amount to be reported on the entitys December 31, 2020 statement of financial position is P1,035,630.
d. None of the above.
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Financial Accounting The Impact On Decision Makers
Authors: Gary A. Porter, Curtis L. Norton
2nd Edition
0030270995, 978-0030270994
