What amount should lucban report as bonds payable

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Q1. On January 2, 2020, Lucban Company issued 9% bonds in the amount of P10,000,000 which mature on January 2, 2030. The bonds were issued for P9,390,000 to yield 10% resulting in a bond discount of P610,000. Interest is payable annually on December 31. Lucban uses the interest method of amortizing bond discount. In its December 31, 2020 statement of financial position, what amount should Lucban report as bonds payable?

Q2. On March 1, 2020, Pyne Furniture Co. issued P700,000 of 10 percent bonds to yield 8 percent. Interest is payable semiannually on February 28 and August 31. The bonds mature in ten years. Pyne Furniture Co. is a calendar-year corporation. The interest expense to be recognized in 2020 profit or loss is?

Reference no: EM132864058

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