At the beginning of the current year, Cove Company, a closely-held entity, issued 6% bonds with a maturity value of P6,000,000, together with 10,000 ordinary shares of P50 par value, for a combined...

Extracted text: At the beginning of the current year, Cove Company, a closely-held entity, issued 6% bonds with a maturity value of P6,000,000, together with 10,000 ordinary shares of P50 par value, for a combined car amount of P11,000,000. If issued separately, the bonds would have sold for P4,000,000 an 8% yield to maturity basis. 1. What amount of the proceeds should be allocated to the ordinary shares? Please show solution