What interest expense is to be reported on december

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Problem 1: B Company issued, in a private placement with an investment house, P3,000,000 face value of three-year, 16% bonds. Interest is payable semiannually on June 30 and December 31 of each year. It was called on June 30, 2017. The bonds were issued on January 1, 2015 at a price yielding the entity P2,738,682 which represents an effective interest cost of 20% per year. What interest expense is to be reported on December 31, 2016?

a. 273,868

b. 277,255

c. 280,981

d. 285,079

e. None of the choices

Problem 2: What interest expense is to be reported on December 31, 2017?

a. 285,079

b. 289,586

c. 294,545

d. 584,132

e. None of the choices

Reference no: EM132775173

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