On January 1, 2020 DEF Company sold machineries with a carrying amount of P4,800,000 in exchange for a P6,000,000 noninterest-bearing note due January 1, 2023. There was no established exchange price for the machineries. The prevailing rate of interest for similar note was 10%. The present value of 1 at 10% for three periods is 0.75 and the present value of annuity of 1 at 10% for three periods is 2.4869. Compute the interest income for 2020
On January 1, 2020 DEF Company sold machineries with a carrying amount of P4,800,000 in exchange for a P6,000,000 noninterest-bearing note due January 1, 2023. There was no established exchange price for the machineries. The prevailing rate of interest for similar note was 10%. The present value of 1 at 10% for three periods is 0.75 and the present value of annuity of 1 at 10% for three periods is 2.4869. Compute the interest income for 2020
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
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 10MC: On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring...
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On January 1, 2020 DEF Company sold machineries with a carrying amount of P4,800,000 in exchange for a P6,000,000 noninterest-bearing note due January 1, 2023. There was no established exchange price for the machineries. The prevailing rate of interest for similar note was 10%. The present value of 1 at 10% for three periods is 0.75 and the present value of annuity of 1 at 10% for three periods is 2.4869. Compute the interest income for 2020
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