On Jan. 1, 2021, Muta Co. received a P1,200,000, noninterest bearing note in exchange for land with carrying amount of P1,000,000. The note is due in three equal annual installments every Dec. 31. The effective interest rate is 15%. The present value of ordinary annuity of 1 at 15% for 3 periods is 2.2832 Requirements: 1. Prepare the amortization table. 2. Determine the current and non-current portions of the note on December 31, 2021. 3. Provide all the necessary journal entries.
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On Jan. 1, 2021, Muta Co. received a P1,200,000, noninterest bearing note in exchange
for land with carrying amount of P1,000,000. The note is due in three equal annual
installments every Dec. 31. The effective interest rate is 15%. The present value of
ordinary annuity of 1 at 15% for 3 periods is 2.2832
Requirements:
1. Prepare the amortization table.
2. Determine the current and non-current portions of the note on December 31,
2021.
3. Provide all the necessary
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- On January 1, 2021, Pindang Co. received a P1,000,000, noninterest bearing note inexchange land with carrying amount of P1,000,000. The note is due in four equal annual installments every December 31. The effective interest rate is 15%. The present value of ordinary annuity of 1 at 15% for 4 periods is 2.855Requirements:1. Prepare the amortization table.2. Determine the current and non-current portions of the note on December 31,2021.3. Provide all the necessary journal entries.On December 31, 2021, Boston Company purchased a machine from Helix Company in exchange for a noninterest bearing note requiring eight payments of P200,000. The first payment was made on December 31, 2021 and the others are due annually on December 31. At date of issuance, the prevailing rate of interest for this type of note was 11%. The PV of an ordinary annuity of 1 at 11% for 8 periods is 5.146, and the PV of an annuity of 1 in advance at 11% for 8 periods is 5.712. What is the interest expense for 2022?On December 31, 2021, Bart Company purchased a machine from fell company in exchange for a noninterest bearing note requiring eight payments of P200,000. The first payments was made on December 31, 2021 and the other are due annually on December 31. At date of issuance, the prevailing rate of interest for this type of note was 11%. Present value factors are as follows: PV of an ordinary annuity of 1 at 11% for 8 periods 5.146 PV of an annuity of 1in advance at 11% at 8 periods 5.712 In the December 30, 2021 statement of financial position, what is the carrying amount of the note payable?
- On Dec. 31, 2020, Boss Company purchased a machine from Len Company in exchange for a noninterest bearing note requiring three payments of P 800,000. The first payment was made on Dec. 31, 2020 and the others are due annually on Dec. 31. At the date of issuance, the prevailing interest rate for this note was 10%The PV of an ordinary annuity of 1 at 10% for 3 periods is 2.487 while the PV of an annuity in advance of 1 at 10% for 3 periods is 2.736. On Dec. 31, 2021, what is the carrying amount of the note payable? *a. P 1,388,800b. P 727,680c. P 1,388,560d. P 1,189,600On December 31, 2020, Bart Company purchased a machine in exchange for a noninterest bearing note requiring eight payments of P200,000. The first payment was made on December 31, 2020 and the others are due annually on December 31. At date of issuance, the prevailing rate of interest for this type of note was 11%. PV of an ordinary annuity of 1 at 11% for 8 periods 5.146 PV of an annuity of 1 in advamce at 11% for 8 periods at 5.712 1. What amount should be recorded at initial cost of the machine? 2. What is the discount on note payable on December 31, 2020? 3. What i sthe interest expense for 2021? 4. What is the carrying amount of note payable on December 31, 2021? i need answers for all 4 questions.On January 1, 2021, J Company sold equipment at a cost of P400,000. The consideration is a non interest bearing note. Related Data of the Note: The annual collection for three period is P200,000 payable every start of the year beginning January 1, 2021. The effective rate is 10%. The present value of an ordinary annuity of 1 for three periods at 10% is 2.4869. The present value of an anuity of 1 in advance for three periods at 10% is 2.7355. What is the unearned interest income on January 1, 2021?
- On December 31, 2019, Bart Company purchased a machine in exchange for anoninterest bearing note requiring eight payments 0 P200,000. The first payment was made on December 31, 2019 and the others are due annually on December 31. At date of issuance, theprevailing rate of interest for this type of note. was 11%. The present value of an ordinaryannuity of 1 at 11% for 8 periods is 5.146 and the present value of an annuity of 1 in advance at11% for 8 periods is 5.712 What is the carrying amount of note payable on December 31, 2020?On January 1, 2021, Jin Company sold equipment at a cost of P400,000 The consideration is a noninterest-bearing note. Related data of the note: The annual collection for three periods is P200,000 payable every start of the year beginning January 1, 2021. The effective rate is 10% The present value of an ordinary annuity of 1 for three periods at 10% is 2.4869. The present value of an annuity of 1 in advance for three periods at 10% is 2.7355. What is the unearned interest income on January 1, 2021?On December 31, 2019, Bart Company purchased a machine in exchange for anoninterest bearing note requiring eight payments 0 P200,000. The first payment was made on December 31, 2019 and the others are due annually on December 31. At date of issuance, theprevailing rate of interest for this type of note. was 11%. The present value of an ordinaryannuity of 1 at 11% for 8 periods is 5.146 and the present value of an annuity of 1 in advance at11% for 8 periods is 5.7126) What amount should be recorded as the initial cost of the machine?7) What is the discount on note payable on December 31, 2019?8.) What amount should be reported as intereșt expense for 2020?9) What is the carrying amount of note payable on December 31, 2020?
- On January 1, 2021, Diggs Co. lends some money in exchange for a 10% $100,000 10-year note. The market rate for similar notes is 8%. Interest is received semiannually each July 1 and January 1. The financial year ends December 31. Round to the nearest whole number. (Hint: Prepare a partial amortization schedule to July 1, 2023) a. The note is issued at ___________(par / premium / discount) b. The present value of the note is $______________ c. The cash received at July 1, 2021 is $__________________ d. The interest income to Diggs Co. at December 31, 2022 is $_________________ e. The carrying amount of the note at July 1, 2023 is $__________________On January 1, 2021, VKS Corporation sold goods to IntAcc2 Company. IntAcc2 signed a noninterest-bearing note requiring payment of P600,000 annually for seven years. The first payment was made on January 1, 2021.The prevailing rate of interest for this type of note at date of issuance was 10%.· PV of an ordinary annuity of 1 at 10% for 6 period- 4.36· PV of an ordinary annuity of 1 at 10% for 7 period- 4.87What is the carrying amount of the note receivable on January 1, 2021?On December 31, 2020, Queen Company sold an equipment with carrying amount of P2,000,000 and received a noninterest-bearing note requiring payment of P500,000 annually for ten years. The first payment is due December 31, 2021. The prevailing interest rate of interest for this type of note at date of issuance is 12%. Present value of 1 at 12% for 10 periods - 0.322 and Present value of ordinary annuity of 1 at 12% for 10 periods - 5.650. On December 31, 2020, >what is the carrying amount if note receivable? >What is the gain on sale of equipment to be recognized in 2020? >What is the carrying amount of the note receivable on December 31, 2021? >What amount of interest income should be recognized for 2021?