On January 01, 2021, VKS Company sold equipment costing P760,000 with accumulated depreciation of P320,000 on the date of sale. CPA received as consideration for the sale, a P800,000 noninterest-bearing note due January 1, 2025. There was no established exchange price for the equipment and the note had no ready market. The prevailing rate of interest for a note of this type on January 01, 2021 was 5%. Using two decimal places for the present value (PV) factor, what is the note’s carrying amount on December 31, 2021?
On January 01, 2021, VKS Company sold equipment costing P760,000 with accumulated depreciation of P320,000 on the date of sale. CPA received as consideration for the sale, a P800,000 noninterest-bearing note due January 1, 2025. There was no established exchange price for the equipment and the note had no ready market. The prevailing rate of interest for a note of this type on January 01, 2021 was 5%. Using two decimal places for the present value (PV) factor, what is the note’s carrying amount on December 31, 2021?
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 24E: Notes Receivable and Income On January 1, 2019, Pitt Company sold a patent to Chatham Inc. which had...
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On January 01, 2021, VKS Company sold equipment costing P760,000 with accumulated
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