Lord Corporation acquired bonds with a face value of P3,000,000 for P2,800,000 on January 1, 2020. The bond has a stated interest of 10%, pays interest every December 31, and matures on December 31, 2022. Requirements: 1. Prepare the necessary journal entries to record the above transactions. 2. How much is the investment in bonds on December 31, 2020? 3. Assuming that the bond is a serial bond and the P1,000,000 matures every December 31. Prepare the journal entries to record the transactions. 4. The same information in No. 3, how much is the investment in bonds on December 31, 2020?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Lord Corporation acquired bonds with a face value of P3,000,000 for P2,800,000 on January 1, 2020. The bond has a stated interest of 10%, pays interest every December 31, and matures on December 31, 2022.

Requirements:
1. Prepare the necessary journal entries to record the above transactions.
2. How much is the investment in bonds on December 31, 2020?
3. Assuming that the bond is a serial bond and the P1,000,000 matures every December 31.
Prepare the journal entries to record the transactions.
4. The same information in No. 3, how much is the investment in bonds on December 31, 2020?

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