FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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On January 1, 2020, Jonathan Company borrowed P500,000 8% note due in four years. The present value of the note on the date of issuance was P367,500.
The entity elected irrevocably the fair value option in measuring the note payable. On December 31, 2020, the fair value of the note is P408,150
- What is the carrying amount of the note payable on December 31, 2020?
- 500,000
- 367,500
- 408,150
- 460,000
- What amount should be reported as interest expense for 2020?
- 40,000
- 29,400
- 32,562
- 20,000
- What amount of gain from change in fair value of the note payable should be reported for 2020?
- 135,500
- 172,500
- 91,850
- 29,400
- At what amount should the discount on note payable be presented on December 31, 2020?
- 132,500
- 103,100
- 91,850
- 0
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