e was no established exchange price for the equipmentThe prevailing rate of interest for a note of this type at January 2.2020 was 10
e was no established exchange price for the equipmentThe prevailing rate of interest for a note of this type at January 2.2020 was 10
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 2 abc Corp sold equipment with a carrying amount of P480,000 in exchange for a P600,000 non-interest bearing note due Jan 22023. There was no established exchange price for the equipmentThe prevailing rate of interest for a note of this type at January 2.2020 was 10%. The present value of 1 at 10% for three periods is 0.75. How much should Abc corp report as gain(loss) on sale of equipment in its 2020 income statement?
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