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What amount should the investment in bonds be recorded

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On October 1, 2016, ABC Company purchased P2,000,000 face amount of 12% bonds for 98 plus accrued interest and transaction cost and classified them as financial assets at amortized cost. Interest is paid semiannually on January 1, and July 1. Transaction cost was P50,000.

Question 1: At what amount should the investment in bonds be recorded?

Option 1: P1,960,000

Option 2: P2,070,000

Option 3: P2,020,000

Option 4: P2,010,000

Option 5: Answer not given

Reference no: EM132568076

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