TOPIC: ACCOUNTING FOR BONDS

PLEASE SHOW THE SOLUTION SO THAT I CAN UNDERSTAND IT MORE. THANKYOU.

Problem 1 Downing Company issues P5,000,000, 6%. 5-year bonds dated January 1, 2019 on January 1, 2019. The bonds pay interest semiannually on June 30 and December 31. The bonds are issued to yield 5%. What are the proceeds from the bond issue? 2.5% 3.0% 5.0% 6.0% Present value of a single sum for 5 periods .88385 .86261 .78353 .74726 Present value of a single sum for 10 periods .78120 .74409 .61391 .55839 Present value of an annuity for 5 periods 4.64583 4.57971 4.32948 4.21236 Present value of an annuity for 10 periods 8.75206 8.53020 7.72173 7.36009 A. P5,000,000 B. P5,216,494 c. P5,217,308 D. P5,218,809