Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Question
Chapter 16, Problem 16.22E
To determine
Under IFRS, the amount of impairment loss or gain and how it would be reported.
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The following information pertains to Mane Lending Corporation’s loan portfolio as at December 31, 2021:
A. Mane Lending Corporation considers all loans over 90 days past due to be credit-impaired based on historical experience with recovering the associated debt.
B. The aging of Mane Lending Corporation’s loan on December 31, 2021 is a follows:
Current
P 1,400,000
More than 30 days past due
75,000
More than 60 days past due
100,000
More than 90 days past due
125,000
Total
P 1,700,000
C. Mane Lending Corporation monitors certain loans more closely on an individual basis given their significance and unique characteristics. These loans are not included in the P1,700,000 loan portfolio. The following information is available without undue cost or effort on an individual loan basis:
LOAN
AMOUNT
PAST DUE STATUS
PV OF EXPECTED FUTURE CASH FLOWS
1
P 200,000
90 days
P…
1. On January 1, 2011, Taguig
Company issued 3-year bonds
with face value of P5,000,00O
at 99. The nominal rate is 10%
and the interest is payable
annually on December 31.
Additionally, Taguig Company
paid bond issue cost of
P150,000. What is the
effective rate that should be
used for these bonds? Round
off present value factors to
FOUR DECIMAL PLACES and
the effective rate to two
decimal places (e.g., 15.17%). *
Your answer
On January 1, 2018, Almost Inc. loaned P3,000,000 to Stay Company. Under the loan agreement, Stay
Company is to make an annual principal payment of P600,000 for 5 years plus interest at 8%. The first
principal and interest payment is due on January 1, 2019. The required payments were made by Stay
Company for 2019 and 2020. However, during 2020, Stay Company began to face financial difficulties,
requiring Almost Inc. to reevaluate the collectability of the loan.
On December 31, 2020, Almost Inc. determines that it will be able to collect the remaining principal, but it
is unlikely that the interest will be collected.
The following present value factors are taken from the table of present values:
PV of 1 at 8% for:
1 period
2 periods
3 periods
0.92593
0.85734
0.79383
What is the present value of the expected future cash flows as of December 31,
2020?
O 1,800,000
O 2,146,260
O 1,669,962
O 1,428,894
Chapter 16 Solutions
Intermediate Accounting (2nd Edition)
Ch. 16 - Prob. 16.1QCh. 16 - Is reporting an investment at its cost considered...Ch. 16 - Prob. 16.3QCh. 16 - Prob. 16.4QCh. 16 - Prob. 16.5QCh. 16 - Prob. 16.6QCh. 16 - What categories can managers use to classify...Ch. 16 - When is the equity method of accounting for...Ch. 16 - Prob. 16.9QCh. 16 - Can companies apply the fair value option to all...
Ch. 16 - What is the fair value hierarchy for investment...Ch. 16 - Prob. 16.12QCh. 16 - Prob. 16.13QCh. 16 - Prob. 16.14QCh. 16 - Prob. 16.15QCh. 16 - Prob. 16.16QCh. 16 - Prob. 16.17QCh. 16 - Deutsch Imports has three securities in its...Ch. 16 - Prob. 16.2MCCh. 16 - Prob. 16.3MCCh. 16 - Prob. 16.4MCCh. 16 - Prob. 16.5MCCh. 16 - Prob. 16.6MCCh. 16 - Prob. 16.7MCCh. 16 - Prob. 16.1BECh. 16 - Prob. 16.2BECh. 16 - Debt Investments, Trading. Using the information...Ch. 16 - Prob. 16.4BECh. 16 - Prob. 16.5BECh. 16 - Prob. 16.6BECh. 16 - Prob. 16.7BECh. 16 - Prob. 16.8BECh. 16 - Prob. 16.9BECh. 16 - Prob. 16.10BECh. 16 - Prob. 16.11BECh. 16 - Prob. 16.12BECh. 16 - Prob. 16.13BECh. 16 - Notes Receivable. Aaron Anatole accepted a...Ch. 16 - Prob. 16.15BECh. 16 - Prob. 16.16BECh. 16 - Prob. 16.17BECh. 16 - Debt Investments. Impairments. IFRS. For each debt...Ch. 16 - Prob. 16.19BECh. 16 - Prob. 16.1ECh. 16 - Prob. 16.2ECh. 16 - Prob. 16.3ECh. 16 - Prob. 16.4ECh. 16 - Prob. 16.5ECh. 16 - Prob. 16.6ECh. 16 - Prob. 16.7ECh. 16 - Debt and Equity Investments, Available-for-Sale...Ch. 16 - Prob. 16.9ECh. 16 - Equity Investments without a Readily Determinable...Ch. 16 - Prob. 16.11ECh. 16 - Prob. 16.12ECh. 16 - Prob. 16.13ECh. 16 - Equity-Investments, Equity Method. Book Value of...Ch. 16 - Prob. 16.15ECh. 16 - Prob. 16.16ECh. 16 - Notes Receivable. Each of the following three...Ch. 16 - Notes Receivable. On January 1, 2018, Racine...Ch. 16 - Debt Investment, Held to Maturity, Impairments....Ch. 16 - Debt Investment, Impairments, IFRS. Repeat E16-19...Ch. 16 - Prob. 16.21ECh. 16 - Prob. 16.22ECh. 16 - Prob. 16.23ECh. 16 - Prob. 16.24ECh. 16 - Prob. 16.25ECh. 16 - Prob. 16.1PCh. 16 - Debt Investments, Trading. Freder Software Group...Ch. 16 - Prob. 16.3PCh. 16 - Equity Investments, Readily Determinable Fair...Ch. 16 - Prob. 16.5PCh. 16 - Prob. 16.6PCh. 16 - Prob. 16.7PCh. 16 - Prob. 16.8PCh. 16 - Prob. 16.9PCh. 16 - Prob. 16.10PCh. 16 - Prob. 16.11PCh. 16 - Equity Investments, Equity Method, Fair Value...Ch. 16 - Prob. 16.13PCh. 16 - Prob. 16.14PCh. 16 - Prob. 16.15PCh. 16 - Prob. 16.16PCh. 16 - Prob. 16.17PCh. 16 - Prob. 16.18PCh. 16 - Prob. 16.19PCh. 16 - Prob. 1JCCh. 16 - Prob. 2JCCh. 16 - Prob. 1SSCCh. 16 - Prob. 1BCCCh. 16 - Prob. 2BCC
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