Prepare all of the relevant journal entries

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Reference no: EM131210993

Titania Co. sells P 400,000 of 12% bonds on June 1, 2010. The bonds pay interest or December 1 and June 1. The due date of the bonds is June 1, 2014. The bonds yield 10% On October 1, 2011, Titania buys back P 120,000 worth of bonds for P126,000, including accrued interest. Give entries through December 1, 2012.

For the two cases, prepare all of the relevant journal entries from the time of sale until the date indicated.

Use the effective-interest method for discount/premium amortization (though no required, you may construct amortization tables where applicable).

Round present value factors to four decimal places.

Round present values, interest expenses and carrying values to the nearest peso.

Reference no: EM131210993

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