Gordon Company sold an equipment with a cost of P750,000 for an installment price of P1,000,000 on January 2, 2020. Gordon received 20% down payment and the balance will be paid in eight equal quarterly installment starting March 31, 2020. The market rate of interest is 10%. The customer defaulted on the payment of fourth quarterly installment which resulted to repossession of the equipment. Gordon anticipates selling price on reconditioned equipment of P400,000 after reconditioning it for P50,000. The gross profit for reconditioned equipment is expected to be 15% (Round off PV factor to 4 decimal places). How much is the Repossessed Item to be reported on December 31, 2020? how much is the Gain (Loss) on Repossession? how much is the Interest Revenue in 2020?
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
Gordon Company sold an equipment with a cost of P750,000 for an installment price of P1,000,000 on January 2, 2020. Gordon received 20% down payment and the balance will be paid in eight equal quarterly installment starting March 31, 2020. The market rate of interest is 10%. The customer defaulted on the payment of fourth quarterly installment which resulted to repossession of the equipment. Gordon anticipates selling price on reconditioned equipment of P400,000 after reconditioning it for P50,000. The gross profit for reconditioned equipment is expected to be 15% (Round off PV factor to 4 decimal places).
How much is the Repossessed Item to be reported on December 31, 2020?
how much is the Gain (Loss) on Repossession?
how much is the Interest Revenue in 2020?
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