Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN: 9781285190907
Author: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher: Cengage Learning
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Question
Chapter 2, Problem 6QE
a.
To determine
Calculate the present value of the receivable as on January 1, 2009.
b.
To determine
Calculate the present value of the receivable on December 31, 2009.
c.
To determine
Calculate the present value of the receivables as on December 31, 2010.
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Gerda Motors purchased custom-made machinery on January 1, 2018, in exchange for a three-year $300,000 note with a stated annual interest rate of 3%, which is paid at the end of each year starting on December 31, 2018 through December 31, 2020. Because it was so custom, Gerda did not know the fair value of the machinery. The market rate for a note of similar risk is 7%.
A. What is the value of the machinery capitalized on the balance sheet on January 1, 2018? [ Select ] ["300,000", "273,000", "278,304", "268,508"]
B. How much interest expense is recognized on December 31, 2018? [ Select ] ["19,481", "21,000", "9,000", "18,796"]
C. What is the carrying value of the note on December 31, 2018? [ Select ] ["278,304", "268,508", "300,000", "288,785"]
Please avoid image based solution thnx
On January 1, 2021, ABC Co. sold a transportation equipment with a historical cost of ₱1,000,000 and accumulated depreciation of ₱300,000 in exchange for cash of ₱100,000 and a noninterest-bearing note receivable of ₱800,000 due on January 1, 2025. The prevailing rate of interest for this type of note is 12%.
How much is the gain / (loss) on sale?
How much is the unamortized interest on December 31, 2023?
Explosib, Inc. acquired two units of equipment on December 31, 2021. The first equipment was purchased in exchange for a ten-year non-interest bearing note requiring annual payment of P1,000,000 every December 31 starting December 31, 2022. The second equipment was acquired by issuing a two-year P6,000,000 non-interest bearing note. The prevailing rate for notes of these types on December 31, 2021 was 12%. What is the total cost of the two units of equipment? Present value factor round to two (2) decimal placesA. 10,130,000 B. 10,450,000 C. 11,130,000 D. 16,470,000
On July 1, 2021, Bulkeyno Inc. exchanged machine with Mawnteyn Company. Bulkeyno’s cost to the machine was P576,000 with related accumulated depreciation of P270,000. Its fair market value was P54,000 higher than its book value. Mawnteyn, on the other hand purchased the machine for P660,000. Carrying value as of the date of exchange was P348,000. Bulkeyno paid Mawnteyn P90,000 for the difference in fair values of the two…
Chapter 2 Solutions
Financial Reporting, Financial Statement Analysis and Valuation
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