19. On January 1, 2023, Peace & Calm Corporation purchased P4,000,000 8% bonds for P3,870,304. Peace & Calm records the financial asset at fair value through other comprehensive income. However, if market interest rates fall sufficiently, Peace & Calm will consider selling the investment in bonds to realize associated gain. The bonds were purchased to yield 9%. Interest is payable annually every December 31. The bonds mature on December 31, 2026. On December 31, 2023, the bonds were selling at 102. On December 31, 2024, Peace & Calm sold 25% of the bonds at 104, which is the fair value of the bonds on that date, plus accrued interest. How much is the unrealized gain to be recognized as component of equity on December 31, 2023? a. 289,696 b. 238,023 C. 209,696 181,369
19. On January 1, 2023, Peace & Calm Corporation purchased P4,000,000 8% bonds for P3,870,304. Peace & Calm records the financial asset at fair value through other comprehensive income. However, if market interest rates fall sufficiently, Peace & Calm will consider selling the investment in bonds to realize associated gain. The bonds were purchased to yield 9%. Interest is payable annually every December 31. The bonds mature on December 31, 2026. On December 31, 2023, the bonds were selling at 102. On December 31, 2024, Peace & Calm sold 25% of the bonds at 104, which is the fair value of the bonds on that date, plus accrued interest. How much is the unrealized gain to be recognized as component of equity on December 31, 2023? a. 289,696 b. 238,023 C. 209,696 181,369
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 1RE
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