The trial balance for BLUE Corporation prepared at December 31, 2020 showed a balance of P4,000,000 for Notes Receivables broken as follows: Notes receivable from Company A Notes receivable from Company B 3,000,000 1,000,000 4,000,000 Total Additional information: The notes receivable from Company A is a three-year non- interest bearing note, with face value of P3,000,000. The note was received in exchange for a piece of land sold by BLUE on May 1, 2020. The land was carried in the books at the date of sale at P2,600,000. The difference between the face amount of the note and the carrying value of the land was credited to gain on sale of land. The market interest rate for a note of this type is 10%. The notes receivable from Company B bears interest at 10%. The note was received from sale of goods in the normal
The trial balance for BLUE Corporation prepared at December 31, 2020 showed a balance of P4,000,000 for Notes Receivables broken as follows: Notes receivable from Company A Notes receivable from Company B 3,000,000 1,000,000 4,000,000 Total Additional information: The notes receivable from Company A is a three-year non- interest bearing note, with face value of P3,000,000. The note was received in exchange for a piece of land sold by BLUE on May 1, 2020. The land was carried in the books at the date of sale at P2,600,000. The difference between the face amount of the note and the carrying value of the land was credited to gain on sale of land. The market interest rate for a note of this type is 10%. The notes receivable from Company B bears interest at 10%. The note was received from sale of goods in the normal
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
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 10P
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