On January 1, 2020, Toto Company sold goods to Snow Company. Snow signed a noninterest-bearing note requiring payment of ₱600,000 annually for seven years. The first payment was made on January 1, 2020. The prevailing rate of interest for this type of note at the date of issuance was 10%. Information on present value factors is as follows: Period Present value of 1 at 10% Present value of ordinary annuity of 1 at 10% 6 .56 4.36 7 .51 4.87 What amount should be recorded as sales revenue in January 2020?
On January 1, 2020, Toto Company sold goods to Snow Company. Snow signed a noninterest-bearing note requiring payment of ₱600,000 annually for seven years. The first payment was made on January 1, 2020. The prevailing rate of interest for this type of note at the date of issuance was 10%. Information on present value factors is as follows: Period Present value of 1 at 10% Present value of ordinary annuity of 1 at 10% 6 .56 4.36 7 .51 4.87 What amount should be recorded as sales revenue in January 2020?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2020, Toto Company sold goods to Snow Company. Snow signed a noninterest-bearing note requiring payment of ₱600,000 annually for seven years. The first payment was made on January 1, 2020. The prevailing rate of interest for this type of note at the date of issuance was 10%. Information on present value factors is as follows:
|
Period |
Present value of 1 at 10% |
Present value of ordinary annuity of 1 at 10% |
| 6 |
.56 |
4.36 |
| 7 |
.51 |
4.87 |
What amount should be recorded as sales revenue in January 2020?
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