On January 1, 2011, ABC Corporation bought a machine on P 600,000, 14% , 3-year, note payable. The note will be paid in six equal semi-annual payments starting June 30, 2022. ABC Corp. should record the cost of the machine as: A. P 399,800 B. P 600,000 C. P 684,000 D. P 404,980
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
On January 1, 2011, ABC Corporation bought a machine on P 600,000, 14% , 3-year, note payable. The note will be paid in six equal semi-annual payments starting June 30, 2022. ABC Corp. should record the cost of the machine as:
A. P 399,800
B. P 600,000
C. P 684,000
D. P 404,980
Step by step
Solved in 2 steps
