DAMIPERA Corporation, a lending institution, provided a loan to LAPERA Company for Php5,000,000 on January 1, 2020. The loan has a term of 5 years with interest collectible annually at 10%. Case 1 Case 2 Case 3 Equal After 5 installments Payment of principal After 5 years Direct origination cost Origination fee years at end of the year 20,445 80,309 39,522 400,000 117,272 21,279 Effective interest rate 12.00% 9.50% 10.50%

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Write the journal entries in 2020 and 2021 for the three cases. No need to use PV Factors just get the PRESENT VALUE using the face value, origin cost, and origination fee.
DAMIPERA Corporation, a lending institution, provided a loan to LAPERA Company
for Php5,000,000 on January 1, 2020. The loan has a term of 5 years with interest
collectible annually at 10%.
Case
Case 2
Case 3
Equal
After 5 installments
at end of
Payment of principal
After 5 years
years
Direct origination cost
Origination fee
Effective interest rate
the year
20,445
80,309
39,522
117,272
-- A - .
400,000
21,279
12.00%
9.50%
10.50%
Transcribed Image Text:DAMIPERA Corporation, a lending institution, provided a loan to LAPERA Company for Php5,000,000 on January 1, 2020. The loan has a term of 5 years with interest collectible annually at 10%. Case Case 2 Case 3 Equal After 5 installments at end of Payment of principal After 5 years years Direct origination cost Origination fee Effective interest rate the year 20,445 80,309 39,522 117,272 -- A - . 400,000 21,279 12.00% 9.50% 10.50%
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