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Work On Sheets! Part I (Problem-Solving) : Name: Date: Score

This document contains a worksheet for solving two bond valuation cases. [Case 1 involves bonds issued by Eveready Company, requiring the calculation of present values, bond price, premium/discount, and journal entry. Case 2 involves bonds issued by Toyota Corporation, requiring the calculation of bond issue price, accrued interest, and net cash receipt.] Students are asked to show their work and solutions using a 10-column worksheet. They are also asked three short answer questions about when discounts and premiums on bonds arise and the initial measurement of bonds payable under IFRS 9. The rubric evaluates the problem-solving worksheet for correct accounts, amounts, and computations, and the short answers for content, supporting details, and organization

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Dong Rosello
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468 views

Work On Sheets! Part I (Problem-Solving) : Name: Date: Score

This document contains a worksheet for solving two bond valuation cases. [Case 1 involves bonds issued by Eveready Company, requiring the calculation of present values, bond price, premium/discount, and journal entry. Case 2 involves bonds issued by Toyota Corporation, requiring the calculation of bond issue price, accrued interest, and net cash receipt.] Students are asked to show their work and solutions using a 10-column worksheet. They are also asked three short answer questions about when discounts and premiums on bonds arise and the initial measurement of bonds payable under IFRS 9. The rubric evaluates the problem-solving worksheet for correct accounts, amounts, and computations, and the short answers for content, supporting details, and organization

Uploaded by

Dong Rosello
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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BM2019

NAME: DATE: SCORE:

WORK ON SHEETS!
PART I (PROBLEM-SOLVING)
Determine the requirement for each of the following independent cases. Use a 10-column worksheet for the
solution. (8 items x 5 points)
Case 1: Eveready Company
Eveready Company issued P100,000 of 8% term bonds on January 1, 2X19, due on January 1, 2X24, with
interest payable on July 1 and January 1. The company’s investors are willing to accept the bond at an effective-
interest rate of 6%.

1. What is the present value of P100,000 bonds due in five (5) years at 6% interest payable semiannually?
2. What is the present value of P 4,000 interest payable?
3. What amount would the investors pay for that particular bond?
4. What is the premium/discount at the date of issuance?
5. Provide entry in the books of Eveready on January 1, 2X19.

Case 2: Toyota Corporation


On March 1, 2X19, Toyota Corporation issued at 103 plus accrued interest, 500 of its 9%, P500 bonds. The
bonds are dated January 1, 2X19 and mature on January 1, 2X29. Interest is payable semiannually on January
1 and July 1. Toyota paid transaction costs amounting to P5,000.

6. What is the bond issue price at the date of issuance?


7. What amount is the accrued interest at the date of issuance?
8. What is the net cash receipt from the bond issuance?

PART II (SHORT ANSWER)


In no more than three (3) sentences, answer the following questions (3 items x 5 points):
1. When does the discount on bonds payable arise?
2. When does the premium on bonds payable arise?
3. Applying IFRS 9 Financial Instruments, what is the initial measurement of bonds payable?
Rubric for grading (Problem-Solving): Rubric for grading (Short Answer):
PERFORMANCE INDICATORS POINTS CRITERIA PERFORMANCE INDICATORS POINTS
Correct accounts and amounts used 3 Content Provided pieces of evidence, 3
Computed final amounts are correct/balanced 2 supporting details, and factual
TOTAL 5 scenarios
Organization Expressed the points in clear 2
of ideas and logical arrangement of
ideas
TOTAL 5

03 Task Performance 1 *Property of STI


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