On October 1, KING BOB Company purchased ₱200,000 face value, 12% bonds at 98 plus

accrued interest and brokerage fees and classified them as amortized cost assets. Interest is
paid semiannually on January 1 and July 1. Brokerage fees for this transaction were ₱700. At
what amount should this acquisition of bonds be recorded?
ANSWER:196700

On January 1, 20x1, KEVIN Co. acquired 12%, ₱1,000,000 bonds for ₱1,049,737. The
principal is due on January 1, 20x4 but interest is due annually every December 31.
The bonds are classified as investment measured at amortized cost. The yield rate on
the bonds is 10%. On September 30, 20x2, all the bonds were sold at 110. Commission
paid to the broker amounted to ₱10,000. How much is the gain (loss) on the sale? (if
loss, enter it with () )

ANSWER:22314

DESPICABLE Co holds 10,000 shares of GRU, Inc. as investment in equity securities.

On April 1, 20x1, DESPICABLE receives shares with fair value of ₱520,000 and
aggregate par value of ₱400,000 as share dividend. How much is the dividend
income?
ANSWER:0