On January 1, 2021, Ott Company sold goods to Fox Company. Fox Company signed a noninterest-bearing note requiring payment of P600,000 annually for seven years. The first payment was-made on January 1, 2021. Problem 6-14 (AICPA The prevailing rate of interest for this type of note at date of issuance was 10%. PV of an ordinary annuity of 1 at 10% for 6 periods 4.36 PV of an ordinary annuity of 1 at 10% for 7 periods 4.87 1. What amount should be recorded as sales revenue in January 2021? а. 3,216,000 b. 2,922,000 c. 2,616,000 d. 2,142,000 2. What is the carrying amount of the note receivable on January 1, 2021? a. 3,600,000 b. 2,616,000 c. 3,000,000 d. 2,322,000 3. What amount should be recognized as interest income for 2021? а. 300,000 b. 232,200 c. 261,600 d. 360,000 4. What is the carrying amount of the note receivable on December 31, 2021? a. 3,600,000 b. 3,000,000 c. 2,277,600 d. 2,877,600
On January 1, 2021, Ott Company sold goods to Fox Company. Fox Company signed a noninterest-bearing note requiring payment of P600,000 annually for seven years. The first payment was-made on January 1, 2021. Problem 6-14 (AICPA The prevailing rate of interest for this type of note at date of issuance was 10%. PV of an ordinary annuity of 1 at 10% for 6 periods 4.36 PV of an ordinary annuity of 1 at 10% for 7 periods 4.87 1. What amount should be recorded as sales revenue in January 2021? а. 3,216,000 b. 2,922,000 c. 2,616,000 d. 2,142,000 2. What is the carrying amount of the note receivable on January 1, 2021? a. 3,600,000 b. 2,616,000 c. 3,000,000 d. 2,322,000 3. What amount should be recognized as interest income for 2021? а. 300,000 b. 232,200 c. 261,600 d. 360,000 4. What is the carrying amount of the note receivable on December 31, 2021? a. 3,600,000 b. 3,000,000 c. 2,277,600 d. 2,877,600
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 15P: Comprehensive Receivables Problem Blackmon Corporations December 31, 2018, balance sheet disclosed...
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