Green Bank loaned P9,000,000 to a borrower on January 1, 2018. The terms of the loan were payment in full on January 1, 2023, plus annual interest payment at 12%. The interest payment was made as scheduled on January 1, 2019. However, due to financial setbacks, the borrower was unable to make the 2020 interest payment. The bank considered the loan impaired and projected the cash flows from the loan on December 31, 2020. The bank has accrued the interest on December 31, 2019, but did not continue to accrue interest for 2020 due to the impairment of the loan. The projected cash flows are: Amount Projected on December 31, 2020 Date of Cash flow December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 1,500,000 2,000,000 2,500,000 3,000,000 The present value of 1 at 12% is .89 for one period; .80 for two periods; .71 for three periods; .64 for four periods; and .57 for five periods. P. What is the AJE to record the loan impairment loss for 2020?

Green Bank loaned P9,000,000 to a borrower on January 1, 2018. The terms of the loan were payment in full on January 1, 2023, plus annual interest payment at 12%. The interest payment was made as scheduled on January 1, 2019. However, due to financial setbacks, the borrower was unable to make the 2020 interest payment. The bank considered the loan impaired and projected the cash flows from the loan on December 31, 2020. The bank has accrued the interest on December 31, 2019, but did not continue to accrue interest for 2020 due to the impairment of the loan. The projected cash flows are: Amount Projected on December 31, 2020 Date of Cash flow December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 1,500,000 2,000,000 2,500,000 3,000,000 The present value of 1 at 12% is .89 for one period; .80 for two periods; .71 for three periods; .64 for four periods; and .57 for five periods. P. What is the AJE to record the loan impairment loss for 2020?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 63.1C: Income, Cash Flow, and Future Losses On January L 2017, Cermack National Bank loaned 55,000,000...

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