Reference no: EM132928931

Questions -

Q1. At the beginning of the current year, EDSA Company issued 5,000,000 of 12% nonconvertible bonds payable at 103 which are due in five years. In addition, every 1,000 bonds were issued with 30 detachable share warrants, each of which entitled the bondholder to purchase, for 50.00, one ordinary share of UMAK company par value 25.00. On the date of issuance, the quoted market value of each warrant was 4.00. The market value of the bonds ex-warrant at the time of issuance is 95.00. What is the carrying amount of the bonds payable on the date of issuance?

Q2. EDSA Company started a promotional campaign on March 31, 2021 in an effort to to increase its sales during pandemic. The company placed a coupon redeemable for a premium of each Lugaw sold. Each premium cost 20 pesos and it requires five coupons must be presented by a customer to receive a premium. The entity estimated that only 60% of the coupons will be redeemed. For the nine months ended December 31, 2021 the following information is available: Packages of Lugaw sold 160,000 ; Premium purchased 12,000; Coupons redeemed 40,000. What amount should be reported as estimated liability for 2021?

Q3. At the beginning of the current year, EDSA Company issued 5,000,000 of 12% nonconvertible bonds payable at 103 which are due in five years. In addition, every 1,000 bonds were issued with 30 detachable share warrants, each of which entitled the bondholder to purchase, for 50.00, one ordinary share of UMAK company par value 25.00. On the date of issuance, the quoted market value of each warrant was 4.00. The market value of the bonds ex-warrant at the time of issuance is 95.00. What amount is credited to the share premium if all of the share warrants are exercised?