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On July 1, 2017, ABC Co. purchased an investment measured at amortized cost P1,000,000 of DEF, Inc's 8% bonds for P946,000, including accrued interest of

  1. On July 1, 2017, ABC Co. purchased an investment measured at amortized cost P1,000,000 of DEF, 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 1,2024 and pay interest annually on January 1. ABC uses the effective method of amortization. In its December 31,2017 balance sheet, what amount should ABC report as investment in bonds?
  • P916,600
  • P911,300
  • Answer not given
  • P960,600
  • P953,300

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