Origination fee received from the borrower Nasty Bank granted a loan to a borrower on January 1, 2020. December 31, 2021. The loan matures in three years on The interest on the loan is 10% payable annually starting December 31, 2023. Principal amount Direct origination cost incurred Origination fee received from the borrower 4,000,000 150,000 342,100 After considering the origination fee received from the horrower and the direct origination cost incurred, the effective rate on the loan is 12%. Required: Prepare journal entries for 2021, 2022 and 2023.
Origination fee received from the borrower Nasty Bank granted a loan to a borrower on January 1, 2020. December 31, 2021. The loan matures in three years on The interest on the loan is 10% payable annually starting December 31, 2023. Principal amount Direct origination cost incurred Origination fee received from the borrower 4,000,000 150,000 342,100 After considering the origination fee received from the horrower and the direct origination cost incurred, the effective rate on the loan is 12%. Required: Prepare journal entries for 2021, 2022 and 2023.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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