Determine the gain or loss on change in fair value

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Problem - On January 1, 2020, Kevin Cosme acquired a P2,000,000, 10% bond for P2,159,708. The ongoing interest rate on the date of the acquisition of the bonds was 8%.Beckham classifies the bond as financial asset at fair value through other comprehensive income The fair value of the bonds at the end of each year is listed below December 31, 2020 102 December 31, 2021 98 December 31, 2022 101

a. Determine the carrying amount of the debt instrument at the end of each year from 2020 to 2022.

b. Determine the interest income recognized by Kevin on the Bonds every year from 2020 to 2022.

c. Determine the gain or loss on change in fair value recognized in Kevin's statement of other Comprehensive income during the year from 2020 to 2022.

d. Determine the ending balance of Unrealized Gain or Loss on Financial Assets at Fair Value through other Comprehensive income found in Kevin shareholders equity at the end of each year from 2020 to 2022.

Reference no: EM132958186

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