On January 1, 2019, VWX Corporation sold equipment costing P380,000 with accumulated depreciation of P160,000 on the date of sale. Adobo received as consideration for the sale, a P400,000, non-interest bearing note, due January 1, 2022. There was no established exchange price for the equipment and the note had no read market. The prevailing rate of interest for a note of this type at January 1, 2019 was 10%. The present value of 1 at 10% for three periods is 0.75. What is the note’s carrying amount at December 31, 2019? 135,000 340,000 330,000 300,000

On January 1, 2019, VWX Corporation sold equipment costing P380,000 with accumulated depreciation of P160,000 on the date of sale. Adobo received as consideration for the sale, a P400,000, non-interest bearing note, due January 1, 2022. There was no established exchange price for the equipment and the note had no read market. The prevailing rate of interest for a note of this type at January 1, 2019 was 10%. The present value of 1 at 10% for three periods is 0.75. What is the note’s carrying amount at December 31, 2019? 135,000 340,000 330,000 300,000

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

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 10MC: On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major...

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