4. Jones Corporation borrowed P9, 000 from Brown Corporation on Jan. 1, 2014 and P12, 000 on Jan. 1, 2016. Jones Corporation made a partial payment of P7, 000 on Jan. 1, 2017. It was agreed that the balance of the loan would be amortizes by two payments one of Jan. 1, 2018 and the other on Jan. 1, 2019, the second being 50%larger than the first. If the interest rate is 12%. What is the amount of each payment? P12,000 a9 000
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- On Jan. 31, 2022, ABC Corp. agreed with the bank a P5,000,000 loan to be credited to ABC on May 1, 2022. The prevailing interest rate on Jan. 31 was 7% but they also entered into a forward rate agreement (FRA) 3-12 to set the interest of the future loan at 8%. The actual interest rate on May 1 was 10%. How much is the interest expense of ABC for the whole term of the loan?On January 1, 2018, Kline Inc. borrowed P9,000 from Harvard Co., and on January 1, 2020, it borrowed P12,000. On January 1, 2021, Kline Inc. paid a P7,000 half payment. The loan balance would be amortized over two payments, one on January 1, 2022 and the other on January 1, 2023, with the second payment being 50 percent bigger than the first. What is the amount of each payment if the interest rate is 10%?With a bit of explanation please.On January 1, 2021, Saltimbocca Corporation borrowed $192,772 from Morgan Stanley. Under the terms of the loan, Saltimbocca will pay $500,000 to Morgan Stanley in ten years (on December 31, 2030), which implies that the yield to maturity (or implicit interest rate) on the loan is 10.0%. What is Saltimbocca’s interest expense on the loan for the year ended December 31, 2023 (the third year of the loan)? (Hint: Round to the nearest dollar. Do not use any dollar signs, commas, or decimals in your answer).
- On May 3, 2020, Leven Corporation negotiated a short-term loan of $660,000. The loan is due October 1, 2020, and carries a 5.40% interest rate. Use ordinary interest to calculate the interestB. MATATAG Bank loaned P5,000,000 to a borrower on January 1, 2019. The term of the loan require principal payments of P1,000,000 each year for 5 years plus interest at 8%. The first principal and interest payment is due on January 1, 2020. The borrower made the required payments during 2020 and 2021. However, during 2021 the borrower began to experience financial difficulties, requiring the bank to reassess the collectability of the loan. On December 31, 2021, the bank has determined that the remaining principal payment will be collected as originally scheduled but the collection of the interest is unlikely. The bank did not accrue the interest on December 31, 2021. Present value of 1 at 8% 0.926 For one period For two periods For three periods 0.857 0.794 1. What is the impairment loss for 2021? а. 423,000 b. 217,000 c. 222,000 d. 0 2. What is the interest income for 2022? a. 126,160 b. 142,640 c. 240,000 d. 0 3. What is the carrying amount of the loan receivable on December 31,…Megabank granted an 8%, 3-year P 6,000,000 loan to Global Company on January 1, 2021. The interest on the loan is payable every December 31. Megabank incurred P 520,600 of direct origination cost but an origination fee of P 200,000 was charged against Global Company. The effective rate on the loan as a result of the origination fee and cost is now 6%. No. QUESTIONS Your Answer 1. What is the carrying value of the loan receivable on January 1, 2021 in Megabank's accounting books? 2. What is the carrying value of the loan receivable on December 31, 2023 in Megabank's accounting books?
- On Jan. 31, 2022, ABC Corp. agreed with the bank a P5,000,000 loan to be credited to ABC on May 1, 2022. The prevailing interest rate on Jan. 31 was 7% but they also entered into a forward rate agreement (FRA) 3-12 to set the interest of the future loan at 8%. The actual interest rate on May 1 was 10%. How much is the cost savings/(incremental cost) attributable to the FRA?What is the carrying amount of the loan receivable on December 31, 2022? Beach Bank loaned Boracay Company P7,500,000 on January 1, 2019. The terms of the loan were payment in full on January 1, 2023 plus annual interest payment at 11%. The interest payment was made as scheduled on January 1, 2020. However, due to financial setbacks, Boracay Company was unable to make the 2021 interest payment. Beach Company considered the loan impaired and projected the cash flows from the loan on December 31, 2021. The bank accrued the interest on December 31, 2020, but did not continue to accrue interest for 2021 due to the impairment of the loan. The projected cash flows are: Date of cash flow Amount projected on December 31, 2021 December 31, 2022 500,000 1,000,000 December 31, 2023 December 31, 2024 December 31, 2025 2,000,000 4,000,000 The PV of 1 at 11% is 0.90 for one period, 0.81 for two periods, 0.73 for three periods, and 0.66 for four periods. a. 7,000,000 b. 5,449,600 c. 4,860,000 d.…Sigma Bank granted a loan to a borrower in the amount of P 5,000,000 on January 1, 2021. The interest rate on the loan is 10% payable annually starting December 31, 2021. The loan matures in five years on December 31, 2025. Sigma Bank incurs P 39,400 of direct loan origination cost and P 10,000 of indirect loan origination cost. In addition, Sigma Bank charges the borrower an 8-point nonrefundable loan origination fee. PV of principal .5674; PV of interest 3.6048 Prepare an amortization table. 1. The carrying amount of the loan as of January 1, 2021 is A. P 4,639,400 B. P 5,000,000 C. P 4,649,400 D. P 5,039,400 2. The effective interest of the loan is A. 9.80 % B. 10% C. 12% D. 11.94% 3. What is the carrying amount of the loan as at December 31, 2021? A. P 5,000,000 B. P 4,696,128 C. P 4,759,663 D. P 4,639,400 3.The interest income to be recognized in 2021 A. P 493,861 B. P 500,000 C. P 555,138 D. P 556,728 4. What is the amount of discount amortization as at December 31, 2021?…
- 1. Eastwest Bank extended a 3-year $5,000,000 loan to Nick Company on January 1, 2020. The interest rate agreed upon is 7%. The bank incurred direct and indirect origination costs of $75,100 and $50,000 respectively, but collected origination fees of $328,230 from Nick Company. The effective interest rate is 9%. On December 31, 2020, how much is the total receivable related to the loan to Nick Company? 2. On January 2, 2019, Anne Inc. sold equipment which has a carrying amount of $400,000 in exchange for a $600,000 4-year non-interest-bearing note that will be due on January 2, 2023. There was no established exchange price for the equipment. The prevailing rate of interest for a note of this type on January 2, 2019 was 10%. What should be recorded as the carrying value of the note receivable as of December 31, 2021 balance sheet?Eastwest Bank extended a 3-year $5,000,000 loan to Nick Company on January 1, 2020. The interest rate agreed upon is 7%. The bank incurred direct and indirect origination costs of $75,100 and $50,000 respectively, but collected origination fees of $328,230 from Nick Company. The effective interest rate is 9%. On December 31, 2020, how much is the total receivable related to the loan to Nick Company?4. Magic Finance Company reports a loan receivable from Blue Company in the amount of P5,000,000. The initial loan’s repayments include a 10% interest rate plus annual principal payment of P1,000,000 on January 1 of each year. The loan was made on January 1, 2020. Blue made the P500,000 interest payments for 2020 but did not make the P1,000,000 principal payment nor the P500,000 interest payment in 2021. Blue is having financial difficulty because of restrictions brought about by the pandemic; thus, Magic has concluded that the loan is impaired. Analysis of Blue’s financial condition on December 31, 2021 indicates that the principal and interest currently due can be collected but it is probable tat no further interest can be collected. The probable amounts and timing of collection are determined as follows: December 31, 2022 – P1,750,000; December 31, 2023 – P2,000,000; December 31, 2024 – P1,750,000. The present value factors at 10% are as follows: One period – 0.909; Two periods –…
