On January 1, 2019, ABC Company sold an equipment with carrying amount of P1,500,000. The customer issued a 5-year P2,000,000, 10% interest bearing note as a payment for equipment sold. The principal of the note is payable on January 2,2024 and interest is payable annually at the end of the year. The effective interest for this note is 12%. 68)How much is the present value of note on January 1,2021? а. 1,134,854 b. 1,925,809 c. 1,241,842 d. 2,000,000 69)How much is the gain or loss on sale of equipment? a. 365,146 gain b. 365,146 loss c. 425,809 gain d. 500,000 gain e. 258,158 loss 70)How much is the carrying amount of note on December 31,2021? a. 1,956,106 b. 1,271,036 c. 1,071,036 d. 1,190,863 e. 2,040,000

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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On January 1, 2019, ABC Company sold an equipment with carrying amount of P1,500,000. The
customer issued a 5-year P2,000,000, 10% interest bearing note as a payment for equipment sold.
The principal of the note is payable on January 2,2024 and interest is payable annually at the end
of the year. The effective interest for this note is 12%.
68)How much is the present value of note on January 1,2021?
а. 1,134,854
b. 1,925,809
с. 1,241,842
d. 2,000,000
69) How much is the gain or loss on sale of equipment?
а. 365,146 gain
b. 365,146 loss
c. 425,809 gain
d. 500,000 gain
e. 258,158 loss
70)How much is the carrying amount of note on December 31,2021?
а. 1,956,106
b. 1,271,036
c. 1,071,036
d. 1,190,863
е. 2,040,000
Transcribed Image Text:On January 1, 2019, ABC Company sold an equipment with carrying amount of P1,500,000. The customer issued a 5-year P2,000,000, 10% interest bearing note as a payment for equipment sold. The principal of the note is payable on January 2,2024 and interest is payable annually at the end of the year. The effective interest for this note is 12%. 68)How much is the present value of note on January 1,2021? а. 1,134,854 b. 1,925,809 с. 1,241,842 d. 2,000,000 69) How much is the gain or loss on sale of equipment? а. 365,146 gain b. 365,146 loss c. 425,809 gain d. 500,000 gain e. 258,158 loss 70)How much is the carrying amount of note on December 31,2021? а. 1,956,106 b. 1,271,036 c. 1,071,036 d. 1,190,863 е. 2,040,000
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