Mermaid Bank granted a loan to a borrower on January 1, 2020. The interest on the loan is 12% payable annually starting December 31, 2020. the loan matures in three years on December 31, 2022. Principal amount 4,000,000 Direct origination cost incurred 80,000 Indirect origination cost incurred 40,000 Origination fee received from the borrower 310,000 a. Compute for the carrying amount of the loan receivable on January 1, 2020. b. Interest income for 2020 c. Carrying amount of the loan receivable on December
Mermaid Bank granted a loan to a borrower on January 1, 2020. The interest on the loan is 12% payable annually starting December 31, 2020. the loan matures in three years on December 31, 2022.
Principal amount 4,000,000
Direct origination cost incurred 80,000
Indirect origination cost incurred 40,000
Origination fee received from the borrower 310,000
a. Compute for the carrying amount of the loan receivable on January 1, 2020.
b. Interest income for 2020
c. Carrying amount of the loan receivable on December 31, 2020.
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