Roth Company received from a customer a one-year, P500,000 note bearing an annual interest of 8%. After holding the note for six months, the entity discounted the note at 10%. What is the discount from the discounting of note?

Roth Company received from a customer a one-year, P500,000 note bearing an annual interest of 8%. After holding the note for six months, the entity discounted the note at 10%. What is the discount from the discounting of note?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 15MC: Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual...

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Question

Roth Company received from a
Customer a one-year, P500,000 note
bearing an annual interest of 8%.
After holding the note for six
months, the entity discounted the
note at 10%.
What is the discount from the
discounting of note?

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