1 / 13

LONG-TERM INVESTMENT (BONDS)

LONG-TERM INVESTMENT (BONDS). WEEK 11. EXERCISE. 1 st july 2007 PT Cahaya purchases Rp 50.000.000,- of 8% bonds of PT.DITHO due in 8 years and 9 months later. The purchase price is Rp 41.706.000 plus interest accrued that paid on 1 st april and 1 st of October .

pelham
Télécharger la présentation

LONG-TERM INVESTMENT (BONDS)

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. LONG-TERM INVESTMENT(BONDS) WEEK 11

  2. EXERCISE 1stjuly 2007 PT Cahaya purchases Rp 50.000.000,- of 8% bonds of PT.DITHO due in 8 years and 9 months later. The purchase price is Rp 41.706.000 plus interest accrued that paid on 1stapril and 1st of October . On 30th June 2014 PT Cahaya sell that bonds on Rp. 47.350.000,- Required questions: • Calculate bonds’ cost • Calculate interest accrued • Journals to record all transactions

  3. BASIC CONCEPT Long-term investment is INVESTMENT TO OTHER COMPANIES FOR MORE THAN ONE ACCOUNTING PERIOD ( > 1 YEAR)

  4. LONG TERM INVESTMENT

  5. PURPOSES • GAINING ADDITIONAL REVENUE GAINING ADDITIONAL REVENUE • BUILDING A NETWORK WITH CLIENTS / OTHER CORPORATIONS • CONTROLLING OTHER COMPANIES

  6. ACCOUNTING FOR LONG-TERM INVESTMENT • LONG-TERM INVESTMENT IS RECORDED BASED ON ITS COST FOR BOTH BONDS AND SHARE • HOW TO CALCULATE IT?

  7. TYPES OF BONDS

  8. AMORTIZED BASED ON THE USEFUL LIFE PREMIUM (AGIO)/ DISCOUNT ( DISAGIO) AMOTIZATION IS CALCULATED ON THE END OF ACCOUNTING PERIOD DIFFERENCE FACE AMOUNT / NOMINAL VALU COST

  9. EXAMPLE 1 MAY 2004 PT. FIA BOUGHT 1.000 BONDS OF PT XYZ WITH A NOMINAL VALUE OF RP 10.000; / BOND AT 105% PLUS A BROKERAGE FEE RP 700.000,. BONDS’ INTEREST RATE WAS 12%. INTEREST IS PAID ON 1/3 – 1/9. BONDS USEFUL LIFE WAS 5 YEARS. Calculate: • Cost • Accrued interest • Journals • Adjustment journal at 31 December

  10. SELLING BONDS BEFORE MATURITY • CALCULATE BONDS’ MARKET PRICE AND ADDITIONAL COS • CALCULATE CARRYING AMOUNT OF BONDS INVESTMENT 3. DIFFERENTS: (1) VS (2) = PROFIT/LOSS ON BONDS SELLING CA = COST – PREMIUM /AGIO THAT HAS BEEN AMOTIZED CA = COST + DISCOUNT / DISAGIO HAS NOT BEEN AMOTIZED YET PROFIT IF : (1) > (2) LOSS IF : (1) < (2)

  11. EXAMPLE 1 OCT 2006 PT. FIA SOLD PT XYZ’S BONDS WITH A NOMINAL VALUE OF RP 4.000.000; AT 110%. ITS BONDS INTEREST WAS 12%. SELLING FEE WAS RP 200.000; HARGA KURS : 110% X 4.000.000; RP 4.400.000; BIAYA PENJUALAN RP 200.000; HARGA JUAL STL BIAYA PENJUALAN RP 4.200.000; HARGA PROLEHAN RP 4.480.000; AMORTISASI AGIO : TH 2004 RP 64.000; TH 2005 RP 96.000; TH 2006 RP 72.000; RP 232.000; NILAI BUKU OBLIGASI RP 4.248.000; RUGI PENJUALAN OBLIGASI RP 48.000; KURS VALUE : 110% X 4.000.000; RP 4.400.000; SELLING FEE RP 200.000; MARKET PRICE RP 4.200.000; COST VALUE OF BONDSRP 4.480.000; PREMIUM’S AMOTIZATION: 2004 RP 64.000; 2005 RP 96.000; 2006 RP 72.000; RP 232.000; CARRYINGAMOUNT RP 4.248.000; LOSS OF BONDS SELLING RP 48.000; +

  12. BONDS INTEREST: (1/12 X12/100) X RP 4.000.000; = 40.000; 01 OCTOBER 2006 : CASH RP 4.240.000; LOSS ON BONDS SELLING RP 48.000; INVESTMENT ON BONDS (PT.FIA) RP 4.248.000; INTEREST REVENUE RP 40.000;

More Related