Question - give all the necessary entries

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Question - Give all the necessary entries from 2018-2020.

On January 1, 2018, Aurora Co. purchased P1,000,000 bonds at 100 which includes accrued interest of 20,000. The bonds mature on December 31, 2021 and pay 12% interest annually beginning December 31, 2018. Commissions paid on the acquisition amounted to P50,000. Aurora's business model is to sell such bonds in the near term to take advantage of fluctuations in fair values for short-term profit making.

Fair value of bonds at the end of:

2018- 102

2019- 100

2020- 98

On March 1, 2020, the P400,000 bonds were sold at 105 which includes accrued interest and incurred 20,000 transaction cost on the sale.

 

Reference no: EM132622152

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