11 (LFRS) of current year, Luy i > Luyang Company issued 3-year Seamount of PS,000,000 at 98. Additionally, the cat cost of P140,000, : a and the effective Tateis 12% after considering iterestis payable annually on December 31. effective interest method in amortizing bond cost. amount of the bonds payable on December 31°? 4,900,000 5,000,000 ( 100,000) (140,000) 4,760,000 571,200 x 4,760,000) x 5,000,000) nt ombonds payable le (240,000 — 71,200) ber 31 interest method, the bond issue cost @iscount on bonds payable. ayable is P100,000 plus 133Problem 9-12 (IFRS) At the beginning of current year, Masbate Company issued 5-yea, bonds with face amount of P5,000,000 at 110. The entity paid bong issue cost of P80,000 on same date. ; The stated interest rate on the bonds is 8% payable annually every December 31. The bonds are issued to yield 6% per annum after considering the bond issue cost. The entity used the effective interes, _ method of amortization. What is the carrying amount of the bonds payable on December 31? a. 5,000,000 b. 5,400,000 ec. 5,345,200 d. 5,430,000 Solution 9-12 Answer c Issue price (5,000,000 x 110) 5,500,000 Premium on bonds payable Bond issue cost Carrying amount ~January 1 > (6% x 5,420,000) 5,000,000 345,200 5,345,200 thod, the bond issue cost ble.(IFRS) ning of current year, Samal Com i E 5 pany issued 8% serial bonds, to be repaid in the amount of *h year. Interest 1s payable annually on December to yield 10% ayear. Were P4,757,000 based on the present value tive annual payments, The entity amortized the bond interest method. ng ‘amount of the bonds payable on December 31? 475,700 400,000 75,700 5,000,000 (1,000,000) 4,000,000 (_ 167,300) 3,832,700 5,000,000 4,757,000 243,000 for current year (75,700) ble - December 3! 167,300 135Problem 9-14 (AICPA Adapted) On January 1, 2022, Dome Company issued P4,000,000, go bonds, to be repaid in the amount of P800,000 each year, wei ; is payable annually on December 31. The bonds were issued to yield 10% a year. The entity amo,, the bond discount by the interest method. Uize The bond proceeds totaled P3,805,600 based on the present on January 1, 2022 of five annual payments. Value Due date Principal Interest PY on 1/179 12/31/2022 800,000 320,000 Mien. 12/31/2023. -—800,000- 256,000 el 12/31/2024 800,000 192.000 $72. 12/31/2025 800,000 128,000 633 Mn) 12/31/2026 800,000 64,000 aa On December 31, 20. i i ie 22, what is the carrying amount of the bon, a. 3,005,600 b. 3,066,160 380,560 320,00 6 194,400 60,560 133,80 202 January 1, 2022 4,000,000 (__300,00) 3,200,000 (_ 133,880 60 30658(AICPA Adapted) ng of current year, Colt Comy ipany issued ten-year bonds of P5,000,000 and a stated i interest rate of 8% atevery year-end, The bonds were priced tovield 10%. periods at 10% 0.3855 annuity of 1 for 10 periods at 10% 6.145 issue price of the bonds? (5,000,000 x 3855) 1,927,500 Payments ( 400,000x6.145) 2,458,000 or issue price of bonds 4,385,500 issued P2. 000, 000 face value of 10-year bonds e bonds pay interest on January 1 and July 1 and f 10%. The market rate of interest is 8%. e ptice of the bonds? 46 13.59 0 x46) 920,000 payments (100,000 x 13.59) 1,359,000 2,279,000 10 years and the perce is payable aa are 20 interest periods. value factor should be for the semiannual 20 interest periods.Problem 9-17 (AICPA Adapted) i ing information i; Margaret Company provided the following n relat to the issuance of bonds at the beginning of current year: Face amount PS,000,09 Term Ten year, Stated interest rate ; 6, Interest payment date Annually on December 3) ‘Yield g 9%, At 6% At oy, Present value of | for 10 periods 0.558 0.422 Future value of | for 10 periods 1.791 2367 Present value of an ordinary annuity of _ | for 10 periods 7.360 6.418 "What is the issue price of the bonds payable? i: 5,000,000 4,318,000 co pokeats i 2,110,000 |(5,000,000 x .422) * 9,110,000 (5,000,000 x 6% = 300,000 x 6.418) 1,925,400 4,035,400 ‘should be determined usine