Answered: ABC Corp acquired a lot by paying down…

ABC Corp acquired a lot by paying down payment of P400,000 and issued a non-interest bearing note of P1,800,000 on Jan 1. Note is due in three annual payments starting Dec 31. Effective rate is 9%

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 5EA: Steele Corp. purchases equipment for $25,000. Regarding the purchase, Steele recorded the following...

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Question

ABC Corp acquired a lot by paying down payment of P400,000 and issued a non-interest bearing note of P1,800,000 on Jan 1. Note is due in three annual payments starting Dec 31. Effective rate is 9%

How much should the land be initially recognized?

1,800,000

1,918,777

2,000,000

2,200,000

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