Money Bank granted a loan to a borrower on January 1, 2022. The interest on the loan is 14% payable annually starting December 31, 2022. The loan matures in three years on December 31, 2025. Principal amount -- P 4,000,000 Origination Fee charged against the borrower -- P 342,100 Direct origination cost incurred -- P150,000 After considering the origination fee charged against the borrower and the direct origination cost incurred, the effective rate on the loan is 16% 1. What is the carrying amount of the loan receivable on January 1, 2022? 2. What is the interest income for 2022? 3. What is the carrying amount of the loan receivable on December 31, 2023? 4. What is the interest income for 2023?
Money Bank granted a loan to a borrower on January 1, 2022. The interest on the loan is 14% payable annually starting December 31, 2022. The loan matures in three years on December 31, 2025. Principal amount -- P 4,000,000 Origination Fee charged against the borrower -- P 342,100 Direct origination cost incurred -- P150,000 After considering the origination fee charged against the borrower and the direct origination cost incurred, the effective rate on the loan is 16% 1. What is the carrying amount of the loan receivable on January 1, 2022? 2. What is the interest income for 2022? 3. What is the carrying amount of the loan receivable on December 31, 2023? 4. What is the interest income for 2023?
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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Money Bank granted a loan to a borrower on January 1, 2022. The interest on the loan is 14% payable annually starting December 31, 2022. The loan matures in three years on December 31, 2025.
Principal amount -- P 4,000,000
Origination Fee charged against the borrower -- P 342,100
Direct origination cost incurred -- P150,000
After considering the origination fee charged against the borrower and the direct origination cost incurred, the effective rate on the loan is 16%
1. What is the carrying amount of the loan receivable on January 1, 2022?
2. What is the interest income for 2022?
3. What is the carrying amount of the loan receivable on December 31, 2023?
4. What is the interest income for 2023?
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