Pangasinan Company is a dealer in equipment. On December 31, 2017, the entity sold an equipment in exchange for a non-interest bearing note requiring five annual payments of P500,000. The first payment was made on December 31, 2018. The market interest for similar notes was 8%. The PV of 1 at 8% for 5 periods is .68 and the PV of an ordinary annuity of 1 at 8% for 5 periods is 3.99. On December 31, 2017, what is the carrying amount of the note receivable?
Pangasinan Company is a dealer in equipment. On December 31, 2017, the entity sold an equipment in exchange for a non-interest bearing note requiring five annual payments of P500,000. The first payment was made on December 31, 2018. The market interest for similar notes was 8%. The PV of 1 at 8% for 5 periods is .68 and the PV of an ordinary annuity of 1 at 8% for 5 periods is 3.99. On December 31, 2017, what is the carrying amount of the note receivable?
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
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 28E: On January 1, 2019, Northfield Corporation becomes delinquent on a 100,000, 14% note to First...
Related questions
Question
Pangasinan Company is a dealer in equipment. On December 31, 2017, the entity sold an equipment in exchange for a non-interest bearing note requiring five annual payments of P500,000. The first payment was made on December 31, 2018.
The market interest for similar notes was 8%. The PV of 1 at 8% for 5 periods is .68 and the PV of an ordinary annuity of 1 at 8% for 5 periods is 3.99.
On December 31, 2017, what is the carrying amount of the note receivable?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Follow-up Questions
Read through expert solutions to related follow-up questions below.
Follow-up Question
What interest income should reported for 2017
Solution
by Bartleby Expert
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning