CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN: 9780357110362
Author: Murphy
Publisher: CENGAGE L
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Chapter 5, Problem 61P
To determine
State the amount of interest that can be deducted for each of the situations given.
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B. 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,…
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?…
Solid Bank loaned P5,000,000 to a borrower on January 1, 2018. The terms 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 are due on January 1, 2019. The borrower made the required payments during 2019 and
to 2020. However, during 2020 the borrower began to experience financial difficulties, requiring the bank
to reassess the collectability of the loan. vnGomo) au9 Vd bonsbneu 6w lodio 69y tne
ert On December 31, 2020, 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, 2020.o 82 o1 1supe b6dblori e beniste16 bns PE to est s bs261obstert
Present value of 1 at 8%vs beidpiew s no belugmo j2oi bap ab obsi snl.noitibe nl
For one period
For two periods
For three periods
0.926 avsb D21o glnevis91 2nu6
Sonitotisteri mort bovia 0.857 ini rdabo to inuoms ei…
Chapter 5 Solutions
CONCEPTS IN FED.TAX.,2020-W/ACCESS
Ch. 5 - Prob. 1DQCh. 5 - Why does the computation of adjusted gross income...Ch. 5 - Prob. 3DQCh. 5 - Prob. 4DQCh. 5 - Prob. 5DQCh. 5 - Prob. 6DQCh. 5 - Prob. 7DQCh. 5 - Prob. 8DQCh. 5 - Prob. 9DQCh. 5 - What is the difference between a trade or business...
Ch. 5 - Prob. 11DQCh. 5 - Prob. 12DQCh. 5 - Prob. 13DQCh. 5 - Prob. 14DQCh. 5 - Prob. 15DQCh. 5 - Prob. 16DQCh. 5 - Prob. 17DQCh. 5 - Prob. 18DQCh. 5 - Prob. 19DQCh. 5 - Prob. 20DQCh. 5 - Prob. 21DQCh. 5 - Prob. 22DQCh. 5 - Prob. 23DQCh. 5 - Prob. 24DQCh. 5 - Prob. 25DQCh. 5 - Prob. 26PCh. 5 - Prob. 27PCh. 5 - Prob. 28PCh. 5 - Prob. 29PCh. 5 - Prob. 30PCh. 5 - Prob. 31PCh. 5 - Prob. 32PCh. 5 - Prob. 33PCh. 5 - Prob. 34PCh. 5 - Prob. 35PCh. 5 - Prob. 36PCh. 5 - Prob. 37PCh. 5 - Prob. 38PCh. 5 - Prob. 39PCh. 5 - Prob. 40PCh. 5 - Prob. 41PCh. 5 - Prob. 42PCh. 5 - Prob. 43PCh. 5 - Prob. 44PCh. 5 - Prob. 45PCh. 5 - Prob. 46PCh. 5 - Prob. 47PCh. 5 - Prob. 48PCh. 5 - Prob. 49PCh. 5 - Prob. 50PCh. 5 - Prob. 51PCh. 5 - Prob. 52PCh. 5 - Prob. 53PCh. 5 - Prob. 54PCh. 5 - Prob. 55PCh. 5 - Hassad owns a rental house on Lake Tahoe. He uses...Ch. 5 - Ray, 83, is a used car dealer. He lives in a rural...Ch. 5 - Prob. 58PCh. 5 - Prob. 59PCh. 5 - Prob. 60PCh. 5 - Prob. 61PCh. 5 - Prob. 62PCh. 5 - Prob. 63PCh. 5 - Prob. 64PCh. 5 - Prob. 65PCh. 5 - Joy incurs the following expenses in her business....Ch. 5 - Prob. 67PCh. 5 - Prob. 68PCh. 5 - Prob. 69PCh. 5 - Prob. 70PCh. 5 - Prob. 71PCh. 5 - Prob. 72IIPCh. 5 - Prob. 73IIPCh. 5 - Prob. 74IIPCh. 5 - Prob. 75IIPCh. 5 - Prob. 76IIPCh. 5 - Prob. 77IIPCh. 5 - Prob. 78IIPCh. 5 - Prob. 79IIPCh. 5 - Prob. 80IIPCh. 5 - Prob. 81IIPCh. 5 - Prob. 91CPCh. 5 - Prob. 92DCCh. 5 - Prob. 93DCCh. 5 - Prob. 94DCCh. 5 - Prob. 95TPCCh. 5 - Allison and Paul are married and have no children....
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