On January 1, 2021, Takemichi Company sold a piece of equipment to Hina Company with a cost of P3,400,000 and accumulated depreciation of P600,000 in exchange for an annual 8% interest-bearing note, P4,000,000. Hina company is required to make five annual payments of principal plus interest. Questions: What is the interest income for the year 2024?  How much is the total proceeds of Takemichi for the year 2025?

On October 1, 2020, ABC Manufacturing sold a tract of land that originally cost P400,000.  ABC received a P600,000, 6% note as payment for the land. The principal amount of the note is payable on September 30, 2023.  Interest is payable every anniversary dates - September 30, 2021, September 30, 2022 and September 30, 2023.  On October 1, 2020, the prevailing rate of interest for a similar obligation is 10%.  On this date, there is no available cash price for the land. PV of a single payment at 6%- 0.8396; PV of a single payment at 10%- 0.7513; PV of ordinary annuity at 6%- 2.6730; PV of ordinary annuity at 10%- 2.4869. ABC's accounting period ends on December 31.  How much is the amortized cost/carrying value of the note receivable reported in ABC’s statement of financial position at December 31, 2021? A. P558,339 B. P563,298 C. P573,215 D. P578,173

On January 1, 2021, Anna Company sold a piece of equipment to Banana Company with a cost of P3,500,000 and accumulated depreciation of P600,000 in exchange for an annual 10% interest-bearing note, P3,000,000. Banana is required to make four equal annual payments of principal plus interest. What is the interest income for the year 2022?

Suri Company is a dealer of real properties. On June 30, 2020, it sold a parcel of land with a tax basis of P1,600,000. A cash downpayment of P200,000 was made. The buyer agreed to shoulder the mortgage attached to the land amounting to P1,700,000. In addition, nine payments of P100,000 are to be made every last day of each calendar quarter after the sale. 24.How much is the gross income to be reported in 2020 using the instalment method, if applicable?

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As of June 30, 2023, Alpha Ltd disclosed the following details regarding its assets and liabilities from its balance sheet: Assets ($000): Computer equipment at purchase price: 300 Accumulated depreciation: (60) Accounts receivable: 100 Allowance for doubtful accounts: (10) Liabilities: Warranty cost provision: 30 Provision for long service leave benefits: 20 Alpha Ltd depreciates its computer equipment over five years for accounting purposes but over three years for tax purposes, using the straight-line depreciation method. No payments were made for long service leave or warranty claims during the fiscal year. Determine the value of each temporary difference for Alpha Ltd as of June 30, 2023. Calculate the carrying amount and tax base, and specify whether each temporary difference is deductible or taxable.

On January 1, 2018, Apple Company sold delivery equipment costing P1,000,000 with accumulated depreciation of P150,000 in exchange for a 3-year, P1,800,000 noninterest bearing note receivable due on December 31, 2020. The prevailing market rate of interest for this type of note is 12%. How much is the gain or loss on sale of delivery equipment in 2018?

On January 1, 2022, Lorry Manufacturing Company purchased equipment from Wales Inc. There was no established market price for the equipment which has an 8 year life and no salvage value. Lorry gave Wales a P105,000 zero-interest-bearing note payable in 3 equal annual installments of P35,000, with the first payment due December 31, 2022. The prevailing rate of interest for a note of this type is 8%. The present value of the note at 8% was P90,199.  Assuming that Lorry uses the straight-line method of depreciation, what amounts will be reported in the company’s 2022 income statement for depreciation expense of the equipment?     P8,750 P11,275 P13,125 P30,066

At the beginning of 2021, VHF Industries acquired a machine with a fair value of $6,774,420 by issuing a four-year, noninterest-bearing note in the face amount of $8 million. The note is payable four annual installments of $2 million at the end of each year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. What is the effective rate of interest implicit in the agreement? 2. to 4. Prepare the necessary journal entries. When recording the issuance of the installment note record it at its net book value in a single note payable (or receivable) account (no Discount). 5. Suppose the market value of the machine was unknown at the time of purchase, but the market rate of interest for notes of similar risk was 12%. Prepare the journal entry to record the purchase of the machine. Complete this question by entering your answers in the tabs below. Required 1 Required 2 to 4 Interest rate What is the effective…

On January 1, 2023, Hornets Company sold land that originally cost P400,000 to the Egi Company. As payment, Egi gave Hornets a P600,000 note. The note bears an interest rate of 8% and is to be repaid in three annual installments of P200,000 plus interest on the outstanding balance. The first payment is due on December 31, 2023. The market price of the land is not reliably determinable. The prevailing interest rate for notes of this type is 8%. Question:30. Assume the same facts given in the problem, but change the prevailing interest rate for notes of this type to 12% (instead of 8%). At how much should the note be recorded on January 1, 2023? A. P600,000B. P560,138C. P480,360D. P427,080