At what amount should this investment presented on december

Assignment Help Accounting Basics

Reference no: EM133919863

Problem

On January 2, 2022, Jerome Company purchased Angel Company, 9% bonds with a face value of P4,000,000 for P3,760,000. Jerome Company intends to collect contractual cash flows from the bonds, and as such the instruments are designated as Held for Collection. The effective interest rate on this investment is 10%. The bonds are dated January 1, 2022 and mature on December 31, 2031. The bonds pay interest semi-annually on June 30 and December 31. Jerome's accounting year is the calendar year. On November 30, 2024, P1,800,000 of the bonds were sold at 98 plus accrued interest. This portion sold is considered to be more than an insignificant portion of the investment. As a result of the change in business model, Jerome reclassified the Angel Company bonds as at fair value through profit or loss. The market value of the bonds was 98 on December 31, 2022, 96 on December 31, 2023 and 98 ½ at December 31, 2024.

A. What is Jerome's interest revenue for the year ended December 31, 2022? Get the instant assignment help.

B. At what amount should this investment be presented on December 31, 2022 statement of financial position?

Reference no: EM133919863

Questions Cloud

Chinn and Kramer theory description components : Review Chinn and Kramer theory description components.

Describe the tragedy of the commons : Lewis describe the "tragedy of the commons." The IMF article in this week's readings explains how this type of problem is an example of an "externality."

Diagnosis of pneumonia and acute respiratory failure : Who has no history of respiratory disease who is being admitted to the ICU from the ER with a diagnosis of pneumonia and acute respiratory failure (ARF)

Analyze and evaluate the cost effectiveness of vaccinating : Analyze and evaluate the cost effectiveness of vaccinating against the vaccine-preventable disease you chose to review. Suggest at least two recommendations

At what amount should this investment presented on december : At what amount should this investment be presented on December 31, 2022 statement of financial position?

High blood pressure with diuretic : You order a potassium level on your patient who is being treated for high blood pressure with a diuretic.

Describe critical area, how it works in your organization : Describe the critical area, how it works in your organization, and what could be done to improve the operation of this key area. You may choose a company

Analyze how synergy control premiums and integration risks : Analyze how synergy, control premiums, and integration risks affect the final valuation. Discuss the role of due diligence and post-merger performance metrics

What is the significance of measuring gdp for country x : What is the significance of measuring GDP for Country X? Why do economists prefer Real GDP over Nominal GDP when assessing growth?

User Account

All Pages