What is the amount paid by pascual on january

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On January 1, 2018, Pascual Company purchased 10% bonds with face value of P5,000,000 in the open market plus direct transaction cost of P101,500. These bonds mature in December 31, 2022 and pay interest annually on December 31. Pascual appropriately classified these bonds as financial assets at amortized cost and amortized this investment using the effective interest method yield rate of 8%. After recording amortization on December 31, 2018, the carrying amounts of the bond investment is P5,331,460.

Problem 1: What is the amount paid by Pascual on January 1, 2018 to purchase the investment excluding the direct transaction cost?

Reference no: EM132915510

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