Problem No. 4 On December 31, 2014, YEN Inc. issued a 3-year P4,500,000 serial bonds payable with 10% interest payable every December 31 starting in 2015. The P4,500,000 bonds is payable through equal annual instailment every December 31. The effective interest rate of the bonds is 8%. 8. What is the initial measurement of the bonds payable on December 31, 2014? 9. What is the interest expense for the year ended December 31, 2015? 10. What is the carrying value of bonds payable on December 31, 2016?

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Problem No. 4
On December 31, 2014, YEN Inc. issued a 3-year P4,500,000 serial bonds payable with 10% interest payable every December 31
starting in 2015. The P4,500,000 bonds is payable through equal annual installment every December 31. The effective interest rate of
the bonds is 8%.
8. What is the initial measurement of the bonds payable on December 31, 2014?
9. What is the interest expense for the year ended December 31, 2015?
10. What is the carrying value of bonds payable on December 31, 2016?
Transcribed Image Text:Problem No. 4 On December 31, 2014, YEN Inc. issued a 3-year P4,500,000 serial bonds payable with 10% interest payable every December 31 starting in 2015. The P4,500,000 bonds is payable through equal annual installment every December 31. The effective interest rate of the bonds is 8%. 8. What is the initial measurement of the bonds payable on December 31, 2014? 9. What is the interest expense for the year ended December 31, 2015? 10. What is the carrying value of bonds payable on December 31, 2016?
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