On December 1, 2020, DEF Company assigned specific accounts receivable totaling P5,000,000 as collateral on a P4,000,000, 12% note from certain bank. The entity will continue to collect the assigned accounts receivable. In addition to the interest on the note, the bank also charged a 5% finance fee deducted in advance on the assigned accounts. The December collections of assigned accounts receivable amounted to P2,000,000 less cash discount of P200,000. On December 31, 2020, the entity remitted the collections to the bank in payment for the interest accrued on December 31, 2020 and the note payable. The entity accepted sales returns of P100,000 on the assigned accounts and wrote off assigned accounts of P300,000. Compute the carrying amount of the note payable on December 31, 2020. * On December 1, 2020, DEF Company assigned specific accounts receivabletotaling P5,000,000 as collateral on a P4,000,000, 12% note from certain bank.The entity will continue to collect the assigned accounts receivable. In addition tothe interest on the note, the bank also charged a 5% finance fee deducted inadvance on the assigned accounts. The December collections of assignedaccounts receivable amounted to P2,000,000 less cash discount of P200,000.On December 31, 2020, the entity remitted the collections to the bank inpayment for the interest accrued on December 31, 2020 and the note payable.The entity accepted sales returns of P100,000 on the assigned accounts andwrote off assigned accounts of P300,000. Compute the carrying amount of thenote payable on December 31, 2020. *Your answerre to searchN

A note payable( short tern loan) is taken from a bank and accounts receivables are given as…

Answered: 1, 2020, DEF Company assigned specific…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On December 1, 2020, DEF Company assigned specific accounts receivable totaling P5,000,000 as collateral on a P4,000,000, 12% note from certain bank. The entity will continue to collect the assigned accounts receivable. In addition to the interest on the note, the bank also charged a 5% finance fee deducted in advance on the assigned accounts. The December collections of assigned accounts receivable amounted to P2,000,000 less cash discount of P200,000. On December 31, 2020, the entity remitted the collections to the bank in payment for the interest accrued on December 31, 2020 and the note payable. The entity accepted sales returns of P100,000 on the assigned accounts and wrote off assigned accounts of P300,000. Compute the carrying amount of the note payable on December 31, 2020. *

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