On January 1, 20x1, SAUCY BOLD Co. acquired a machine by issuing a 3-year, 3%, P4,800,000 note payable. Principal and interests are due in three equal annual installments starting December 31, 20x1. The prevailing interest rate for this type of note is 12%. How much is the carrying amount of the note on initial recognition?

On January 1, 20x1, SAUCY BOLD Co. acquired a machine by issuing a 3-year, 3%, P4,800,000 note payable. Principal and interests are due in three equal annual installments starting December 31, 20x1. The prevailing interest rate for this type of note is 12%. How much is the carrying amount of the note on initial recognition?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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