On January 1, 20x1, SCRUPULOUS EXACT Co, acquired a piece of equipment by issuing a P12,000,000, non- interest bearing note that is payable in three equal annual installments starting January 1, 20x4. The current market rate of interest on January 1, 20x1 is 12%. How much is the carrying amount of the note on initial recognition? (Hint Mind the payment dates.) O a. 7,740,084 O b. 7,124,844 Oc. 7,412,769 O d. 7,658,901

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
On January 1, 20x1, SCRUPULOUS EXACT Co, acquired a piece of equipment by issuing a P12,000,000, non-
interest bearing note that is payable in three equal annual installments starting January 1, 20x4. The current
market rate of interest on January 1, 20x1 is 12%. How much is the carrying amount of the note on initial
recognition?
(Hint Mind the payment dates.)
O a. 7,740,084
O b. 7,124,844
O c. 7,412,769
O d. 7,658,901
Transcribed Image Text:On January 1, 20x1, SCRUPULOUS EXACT Co, acquired a piece of equipment by issuing a P12,000,000, non- interest bearing note that is payable in three equal annual installments starting January 1, 20x4. The current market rate of interest on January 1, 20x1 is 12%. How much is the carrying amount of the note on initial recognition? (Hint Mind the payment dates.) O a. 7,740,084 O b. 7,124,844 O c. 7,412,769 O d. 7,658,901
Expert Solution
steps

Step by step

Solved in 2 steps with 1 images

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education