On July 1, 2020, Jolly Company sold goods in exchange for P2,000,000, 8-month, noninterest-bearing note receivable. At the time of the sale, the note's market rate of interest was 12%. The note was discounted at 10% on September 1, 2020. 1. What amount was received from the note receivable discounting? a. 1,940,000 b. 1,938,000 c. 1,900,000 d. 1,880,000 2. What is the loss on note receivable discounting? a. 100,000 b. 125,000 c. 25,000 d. 0
On July 1, 2020, Jolly Company sold goods in exchange for P2,000,000, 8-month, noninterest-bearing note receivable. At the time of the sale, the note's market rate of interest was 12%. The note was discounted at 10% on September 1, 2020. 1. What amount was received from the note receivable discounting? a. 1,940,000 b. 1,938,000 c. 1,900,000 d. 1,880,000 2. What is the loss on note receivable discounting? a. 100,000 b. 125,000 c. 25,000 d. 0
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 July 1, 2020, Jolly Company sold goods in exchange for P2,000,000, 8-month, noninterest-bearing note receivable.
At the time of the sale, the note's market rate of interest was 12%. The note was discounted at 10% on September 1, 2020.
1. What amount was received from the note receivable discounting?
a. 1,940,000
b. 1,938,000
c. 1,900,000
d. 1,880,000
2. What is the loss on note receivable discounting?
a. 100,000
b. 125,000
c. 25,000
d. 0
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