On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods 3.169865 PV of 10% after 4 interest period .683013 1. What is the amortized cost of the debt as of December 31, 2022? A. 5,619.616 B. 5,701.578 C. 5,791.735 D. 5,890.909

On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods 3.169865 PV of 10% after 4 interest period .683013 1. What is the amortized cost of the debt as of December 31, 2022? A. 5,619.616 B. 5,701.578 C. 5,791.735 D. 5,890.909

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter6: Fixed-income Securities: Characteristics And Valuation

Section: Chapter Questions

Problem 5P

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