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Use the following information for the next two questions. Funan Industries purchases new specialized manufacturing equipment on July 1, 2019. The equipment cash price is P79,000. Funan signs a deferred payment contract that provides for a down payment of P10,000 and an 8-year note for P103,472. The note is to be paid in 8 equal annual payments of P12,934. The payments include 10% interest and are made on June 30 of each year, beginning June 30, 2020. (1) The carrying amount of the note payable on December 31, 2020 is a. P66,115 b. P62,966  c. P59,818 d. P56,329 (2) The total interest expense for the year ended December 31, 2020 is a. P6,900  b. P6,612 c. P6,599 d. P5,982

Use the following information for the next two questions. Funan Industries purchases new specialized manufacturing equipment on July 1, 2019. The equipment cash price is P79,000. Funan signs a deferred payment contract that provides for a down payment of P10,000 and an 8-year note for P103,472. The note is to be paid in 8 equal annual payments of P12,934. The payments include 10% interest and are made on June 30 of each year, beginning June 30, 2020. (1) The carrying amount of the note payable on December 31, 2020 is a. P66,115 b. P62,966  c. P59,818 d. P56,329 (2) The total interest expense for the year ended December 31, 2020 is a. P6,900  b. P6,612 c. P6,599 d. P5,982

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
Chapter17: Advanced Issues In Revenue Recognition
Section: Chapter Questions
Problem 9MC
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Use the following information for the next two questions.

Funan Industries purchases new specialized manufacturing equipment on July 1, 2019. The equipment cash price is P79,000. Funan signs a deferred payment contract that provides for a down payment of P10,000 and an 8-year note for P103,472. The note is to be paid in 8 equal annual payments of P12,934. The payments include 10% interest and are made on June 30 of each year, beginning June 30, 2020.

(1) The carrying amount of the note payable on December 31, 2020 is

a. P66,115

b. P62,966 

c. P59,818

d. P56,329

(2) The total interest expense for the year ended December 31, 2020 is

a. P6,900 

b. P6,612

c. P6,599

d. P5,982

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