User Account

All Pages

What is the interest income for the year

Assignment Help Accounting Basics
Reference no: EM132918452

Question - On Jan. 1, 2021, ABC acquired a 10%, 5-year, P2,000,000 face value bonds for trading purposes. The transaction price was P2,020,000 while transaction cost incurred totaled P57,793. This resulted to an effective interest rate of 9%. The value of the bonds was P2,010,000 and P1,970,000 as of Dec. 31, 2021 and 2022 respectively which resulted to ABC being unable to dispose the investment. In the year 2023, the management decided to hold the investment until its maturity. As of the end of 2023, the bonds are valued at P1,965,750. The effective interest rate as of this date is 11%.

Assuming the investment qualifies for reclassification, what is the interest income for the year 2024?

When initially recognizing the cash surrender value, what is the reason behind the allocation between deducting from insurance expense and crediting to retained earnings? What application of matching principle concept is used?

Reference no: EM132918452

Questions Cloud

What effective dollar interest rate from investing in canada : You observe that the current USD/CAD spot rate is $0.88/CAD and the USD/CAD. What is the effective dollar interest rate from investing in Canada for one year?
What is the expected rate of return on the stock : Question - Company ABC has 10,000 shares outstanding and the stock price is $100. What is the expected rate of return on the stock
Record any adjusting entries required : In December 2019, it provided four tutoring sessions to a client, who agreed to pay $400 after every 10 sessions. Record any adjusting entries required
Prepare the journal entries to record purchase transactions : Prepare the journal entries to record the following purchase transactions in Sunland Company's books. Sunland uses a perpetual inventory system
What is the interest income for the year : The effective interest rate as of this date is 11%. Assuming the investment qualifies for reclassification, what is the interest income for the year 2024
What is the present value of the operating cash flows : The tax rate is 34%. Assume all sales and costs occur at the end of each year. What is the present value of the operating cash flows (OCF)
Calculate the amount of each of the last two payments : The investment costs each investor $1,104,315. With an effective annual rate of 10%, calculate the amount of each of the last two payments
Discuss medication error : Discuss Medication Error (Patient safety related issue) and Root cause analysis through Ishikawa Fishbone.
Carnaval-samba related to politics and religion in brazil : How are Carnaval and samba related to politics and religion in Brazil? What are some things judges are looking for in assessing each escola's performance?

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd