Hot issue company sold its machine with a carrying amount of P2,000,000 in exchange for P2,500,000 non-interest-bearing note that requires five annual payment of P500,000 starting on January 1, 2022. The market interest for similar notes was 10% and the relevant present value factors are: Present value of a single payment at 10% for 5 periods 0.621 Present value of an ordinary annuity of 1 at 10% for periods 3.791 Present value of an annuity due of 1 at 10% for 5 periods 4.170 How much is the interest income for the year 2022?

Hot issue company sold its machine with a carrying amount of P2,000,000 in exchange for P2,500,000 non-interest-bearing note that requires five annual payment of P500,000 starting on January 1, 2022. The market interest for similar notes was 10% and the relevant present value factors are: Present value of a single payment at 10% for 5 periods 0.621 Present value of an ordinary annuity of 1 at 10% for periods 3.791 Present value of an annuity due of 1 at 10% for 5 periods 4.170 How much is the interest income for the year 2022?

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 27E

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Hot issue company sold its machine with a carrying amount of P2,000,000 in exchange for 2,500,000 non-interest bearing note that requires five annual payment of 500,000 starting on January 1, 2022 the market interest for similar notes was 10% and the relevant present value factors are:present value of a single payment at 10% for 5 periods 0.621present value of an ordinary annuity of 1 at 10% for 5 periods 3.791present value of annuity due of 1 at 10% for 5 periods 4.170how much is the gain or loss on sale of machine?a. 104,500 gainb. 85,000 lossc. 85,000 gaind. 104,500 loss
Hot Issue Company sold its machine with a carrying amount of P2,000,000 in exchange for P2,500,000 non-interest-bearing note that requires five annual payment of P500,000 starting on January 1, 2022 2 pts The market interest for similar notes was 10% and the relevant present value factors are Present value of a single payment at 10% for 5 periods Present value of an ordinary annuity of 1 at 10% for 5 periods Present value of an annuity due of 1 at 10% for 5 periods 0.621 3.791 4.170 How much is the interest income for the year 20227 158.500
Solar Co. sold a machine in exchange for a P800,000, 4-year, S note, interest is payable annually. Prevailing market rate of interest for this type of note is 10% wrt How much is the carrying amount of the note receivable on January 1, 2021? How much is the carrying amount of the note receivable on December 31, 2021? ments How much is the interest income received on December 31, 2023? ences ( Previous ssors dents
On December 30, 2022, Hershey Company sold a machine in exchange for a non-interest bearing note requiring ten annual payments of ₱100,000. The first payment was made on December 30, 2022. The market interest rate for similar notes at date of issuance was 8%. The PV of 1 at 8% for 9 periods is .50 and at 10 periods is .46. The PV of ordinary annuity of 1 at 8% for 9 periods is 6.25 and for 10 periods is 6.71.On December 31, 2022, what amount should be reported as notes receivable? [A] 450,000 [B] 460,000 [C] 625,000 [D] 671,000
On December 31, 2021, Bart Company purchased a machine from fell company in exchange for a noninterest bearing note requiring eight payments of P200,000. The first payments was made on December 31, 2021 and the other are due annually on December 31. At date of issuance, the prevailing rate of interest for this type of note was 11%. Present value factors are as follows: PV of an ordinary annuity of 1 at 11% for 8 periods 5.146 PV of an annuity of 1in advance at 11% at 8 periods 5.712 In the December 30, 2021 statement of financial position, what is the carrying amount of the note payable?
On December 30, 2021, JALINON Company sold a machine to GONZALES Company in exchange for a non-interest bearing note requiring ten annual payments of P10,000. GONZALES made the first payment on December 30, 2021. The market interest rate for similar notes at date of issuance was 8%. Information on present value factors is as follows: Period Present value of 1 at 8% Present value of ordinary annuity of 1 at 8% 9 0.50 6.25 10 0.46 6.71 38. In its December 31, 2021 statement of financial position, what amount should JALINON report as non-current portion of the note receivable?
On December 31, 2020, Bart Company purchased a machine in exchange for a noninterest bearing note requiring eight payments of P200,000. The first payment was made on December 31, 2020 and the others are due annually on December 31. At date of issuance, the prevailing rate of interest for this type of note was 11%. PV of an ordinary annuity of 1 at 11% for 8 periods 5.146 PV of an annuity of 1 in advamce at 11% for 8 periods at 5.712 1. What amount should be recorded at initial cost of the machine? 2. What is the discount on note payable on December 31, 2020? 3. What i sthe interest expense for 2021? 4. What is the carrying amount of note payable on December 31, 2021? i need answers for all 4 questions.
On January 1, 2022, Cat Corporation sold goods to Rat Company. Rat Company signed a non-interest-bearing note requiring payment of P600,000 annually for seven years. The first paymentwas made on January 1, 2022. The prevailing rate of interest for this type of note at date ofissuance was 10%. PV of an ordinary annuity of 1 at 10% for 6 periods 4.36PV of an ordinary annuity of 1 at 10% for 7 periods 4.871. What is the amount of Sales Revenue credited on January 1, 2022?2. What is the carrying amount of note receivable on December 31, 2022?
Persever Company is a dealer in equipment. On December 21, 2021, the enitity sold an equipment in exchange for a noninterest bearing note requiring five annual payments of P500,000. The first payment was made on December 31, 2022. The market interest rate for similar notes was 8%. PV of 1 at 8% for 5 periods 0.68 PV of an ordinary annuity of 1 at 8% for periods 3.99 What is the amount of interest income should be reported for 2023?
At year-end, Jovial Company received two P1,000,000 notes receivable from customers in exchange for services rendered. On both note, interest is calculated on the outstanding principal balance at the annual rate of 3% and payable at maturity. The note from Zeta Company, made under customary trade terms, is due in nine months and the note from Yola Company is due in five years. The market interest rate for similar notes was 8%. The present value of 1 due in nine months is .944 and the present value of 1 due in five years is .68. At what amount should the note receivable from Zeta Company be reported at year- end? A.1,000,000 B.944,000 C.965,200 O D.972,320
Persever Company is a dealer in equipment. On December 21, 2021, the enitity sold an equipment in exchange for a noninterest bearing note requiring five annual payments of P500,000. The first payment was made on December 31, 2022. The market interest rate for similar notes was 8%. PV of 1 at 8% for 5 periods 0.68 PV of an ordinary annuity of 1 at 8% for periods 3.99 On December 31, 2021, what is the carrying amount of note receivable?
Begin Again Company sold an equipment with carrying amount of P2,000,000 and received a noninterest-bearing note requiring payment of P500,000 annually for 10 years. The first payment is due December 31, 2021. The prevailing rate of interest for this type of note at date of issuance is 12%. PV of 1 at 12% for 10 periods: 0.322 PV of ordinary annuity of 1 at 12% for 10 periods: 5.650 On December 31, 2020, what is the carrying amount of the note receivable? 5,000,000 2,175,000 1,610,000 2,825,000 What is the gain on sale of equipment to be recognized in 2020? 3,000,000 2,175,000 825,000

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Present value of a single payment at 10% for 5 periods	0.621
Present value of an ordinary annuity of 1 at 10% for periods	3.791
Present value of an annuity due of 1 at 10% for 5 periods	4.170