2. On July 1, 2019, XYZ Co. borrowed P2,000,000 and İssued a one-year promissory note. The lender discounted the note at 12%. (a) Give the journal entries on July 1, 2019. December 31, 2019 to accrue interest on the note and July 1, 2020, upon maturity of the note. (b) What is the carrying amount of the note payable as of July 1, 2019 and December 31, 2019. Show them in good form.

2. On July 1, 2019, XYZ Co. borrowed P2,000,000 and İssued a one-year promissory note. The lender discounted the note at 12%. (a) Give the journal entries on July 1, 2019. December 31, 2019 to accrue interest on the note and July 1, 2020, upon maturity of the note. (b) What is the carrying amount of the note payable as of July 1, 2019 and December 31, 2019. Show them in good form.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 10MC: On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major...

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On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
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