Rockstar Company showed the following balances in connection with its noncurrent liabilities on December 31,...
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Accounting
Rockstar Company showed the following balances in connection with its noncurrent liabilities on December 31, 2020.
Bonds payable 10%, maturing December 31, 2025
P10,000,000
Bonds payable 12%, maturing December 31, 2030
8,000,000
Discount on bonds payable
800,000
Premium on bonds payable
500,000
Bond issue costs
200,000
The discount is related to the 10% bonds payable and the premium and bond issue costs are applicable to the 12% bonds payable. No bonds were retired during 2020. How much interest expense on the bonds payable should Rockstar Company report in its 2020 income statement? (Use straight line amortization method)
A P2,090,000 B P1,870,000 C P2,070,000 D P1,890,000
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