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On January 1, 2021, Allure Con bearing note due in three years with a face amount of P1,000,000. There is no established market value for the equipment. ig 12%. The present

On January 1, 2021, Allure Con bearing note due in three years with a face amount of P1,000,000. There is no established market value for the equipment. ig 12%. The present

Intermediate Accounting: Reporting And Analysis
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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On January 1, 2021, Allure Company sold an equipment with A carrying amount of P800,000, receiving a noninterest bearing note due in three years with a face amount of P1,000,000. There is no established market value for the equipment. Problem 6-18 (IAA) The interest rate on similar obligations is 12%. The present value of 1 at 12% for three periods is .712. 1. What amount should be reported as gain or loss on the sale of equipment in 2021? 200,000 gain b. 200,000 loss 88,000 gain d. 88,000 loss a. ny с. 2. What amount should be reported as interest income for 2021? a. 288,000 b. 120,000 с. 96,000 d. 85,440 3. What is the carrying amount of note receivable on December 31, 2021? a. 559,600 b. 712,000 c. 797,440 d. 800,000 4. What amount should be reported as interest income for 2022? a. 95,693 b. 96,000 c. 75,000 d. 60,000 196 AI QUAD CAMERA Shot by jeremy 2021/10/06 1O:40
Transcribed Image Text:On January 1, 2021, Allure Company sold an equipment with A carrying amount of P800,000, receiving a noninterest bearing note due in three years with a face amount of P1,000,000. There is no established market value for the equipment. Problem 6-18 (IAA) The interest rate on similar obligations is 12%. The present value of 1 at 12% for three periods is .712. 1. What amount should be reported as gain or loss on the sale of equipment in 2021? 200,000 gain b. 200,000 loss 88,000 gain d. 88,000 loss a. ny с. 2. What amount should be reported as interest income for 2021? a. 288,000 b. 120,000 с. 96,000 d. 85,440 3. What is the carrying amount of note receivable on December 31, 2021? a. 559,600 b. 712,000 c. 797,440 d. 800,000 4. What amount should be reported as interest income for 2022? a. 95,693 b. 96,000 c. 75,000 d. 60,000 196 AI QUAD CAMERA Shot by jeremy 2021/10/06 1O:40
Pr On December 31, 2021, Precious Company sold an equipment with earrying amownt of P2,000,000 and received On the for of 1 annually for ten years. The first payment is due December 31, 2022. The prevailing rate of interest for this type of note at date of issuance is 12%. Th Th wa 0.322 Present value of 1 at 12% for 10 periods Present value of ordinary annuity of 1 at 12% for 10 periods PV PV 5.650 1. On December 31, 2021, what is the carrying amount of the note receivable? 1. a. 5,000,000 b. 2,175,000 c. 1,610,000 d. 2,825,000 2. What amount should be recognized as gain on sale of equipment in 2021? a. 3,000,000 b. 2,175,000 825,000 d. c. 3. What amount of interest income should be recognized for 2022? 3. a. 600,000 b. 339,000 c. 319,800 d. 300,000 4. What is the carrying amount of the note receivable on December 31, 2022? a. 2,325,000 b. 4,500,000 c. 2,825,000 d. 2,664,000 AI QUAD CAMERA Shot by jeremy 194 2021/10/06 1O:40 2.
Transcribed Image Text:Pr On December 31, 2021, Precious Company sold an equipment with earrying amownt of P2,000,000 and received On the for of 1 annually for ten years. The first payment is due December 31, 2022. The prevailing rate of interest for this type of note at date of issuance is 12%. Th Th wa 0.322 Present value of 1 at 12% for 10 periods Present value of ordinary annuity of 1 at 12% for 10 periods PV PV 5.650 1. On December 31, 2021, what is the carrying amount of the note receivable? 1. a. 5,000,000 b. 2,175,000 c. 1,610,000 d. 2,825,000 2. What amount should be recognized as gain on sale of equipment in 2021? a. 3,000,000 b. 2,175,000 825,000 d. c. 3. What amount of interest income should be recognized for 2022? 3. a. 600,000 b. 339,000 c. 319,800 d. 300,000 4. What is the carrying amount of the note receivable on December 31, 2022? a. 2,325,000 b. 4,500,000 c. 2,825,000 d. 2,664,000 AI QUAD CAMERA Shot by jeremy 194 2021/10/06 1O:40 2.
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