On January 1, 2021, Tina Bank extended a 5-year, 12%, P5,000,000 loan to Mr. Prospecio. Principal is due on January 1, 2022 but interests are due semi-annually every June 30 and December 31. Tina Bank incurred direct origination cost of P486,087 and indirect origination cost of P50,000. In addition, Tina Bank charged Mr. Prospecio a 2-point nonrefundable origination fee. How much is the carrying value of the note on December 31, 2022?
On January 1, 2021, Tina Bank extended a 5-year, 12%, P5,000,000 loan to Mr. Prospecio. Principal is due on January 1, 2022 but interests are due semi-annually every June 30 and December 31. Tina Bank incurred direct origination cost of P486,087 and indirect origination cost of P50,000. In addition, Tina Bank charged Mr. Prospecio a 2-point nonrefundable origination fee. How much is the carrying value of the note on December 31, 2022?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On January 1, 2021, Tina Bank extended a 5-year, 12%, P5,000,000 loan to Mr. Prospecio.
Principal is due on January 1, 2022 but interests are due semi-annually every June 30 and
December 31. Tina Bank incurred direct origination cost of P486,087 and indirect origination cost
of P50,000. In addition, Tina Bank charged Mr. Prospecio a 2-point nonrefundable origination fee.
How much is the carrying value of the note on December 31, 2022?
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