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On July 1, 20x3, Elsa Inc. purchased as a short-term investment a P 1,000,000 face value Anna Co. 8% bond for P 910,000 plus accrued interest to yield 10%. The bonds mature on January 1, 20x10, pay interest annually on January 1, and are classified as Debt Investments @ Fair Value through Profit or Loss. On December 31, 20x3, the bonds had a fair value of P 945,000. On February 13, 20x4, Elsa sold the bonds for P 920,000. On July 1, 20x3, how much cash was paid by Elsa Inc. in connection with the purchase of the Debt Investments?

On July 1, 20x3, Elsa Inc. purchased as a short-term investment a P 1,000,000 face value Anna Co. 8% bond for P 910,000 plus accrued interest to yield 10%. The bonds mature on January 1, 20x10, pay interest annually on January 1, and are classified as Debt Investments @ Fair Value through Profit or Loss. On December 31, 20x3, the bonds had a fair value of P 945,000. On February 13, 20x4, Elsa sold the bonds for P 920,000. On July 1, 20x3, how much cash was paid by Elsa Inc. in connection with the purchase of the Debt Investments?

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 1RE
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On July 1, 20x3, Elsa Inc. purchased as a short-term investment a P 1,000,000 face value Anna Co. 8% bond for P 910,000 plus accrued interest to yield 10%. The bonds mature on January 1, 20x10, pay interest annually on January 1, and are classified as Debt Investments @ Fair Value through Profit or Loss. On December 31, 20x3, the bonds had a fair value of P 945,000. On February 13, 20x4, Elsa sold the bonds for P 920,000. On July 1, 20x3, how much cash was paid by Elsa Inc. in connection with the purchase of the Debt Investments?

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