ABC Co received from a customer a 3-year non-interest bearing note of P120,000 on Jan 1, 20X1. Effective rate is 10% and collectible in 3 equal annual installments beginning Dec 31, 20X1. PV of P1 at 10% for 3n= .75131 PV of an ordinary annuity P1 at 10% for 3n =2.48685 The entry to record the receipt of the note would include: Cr Sales 120,000 Cr Notes Receivable 120,000 Dr Notes Receivable 90,157 Cr Unearned interest income 20,526
ABC Co received from a customer a 3-year non-interest bearing note of P120,000 on Jan 1, 20X1. Effective rate is 10% and collectible in 3 equal annual installments beginning Dec 31, 20X1. PV of P1 at 10% for 3n= .75131 PV of an ordinary annuity P1 at 10% for 3n =2.48685 The entry to record the receipt of the note would include: Cr Sales 120,000 Cr Notes Receivable 120,000 Dr Notes Receivable 90,157 Cr Unearned interest income 20,526
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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3.ABC Co received from a customer a 3-year non-interest bearing note of P120,000 on Jan 1, 20X1. Effective rate is 10% and collectible in 3 equal annual installments beginning Dec 31, 20X1.
PV of P1 at 10% for 3n= .75131
PV of an ordinary annuity P1 at 10% for 3n =2.48685
The entry to record the receipt of the note would include:
PV of P1 at 10% for 3n= .75131
PV of an ordinary annuity P1 at 10% for 3n =2.48685
The entry to record the receipt of the note would include:
Cr Sales 120,000
Cr Notes Receivable 120,000
Dr Notes Receivable 90,157
Cr Unearned interest income 20,526
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