Solid Bank loaned P5,000,000 to a borrower on January 1, 2018 The terms of the loan require principal payments of P1,000,000 each year for 5 years plus interest at 8%. The first principal and interest payment is due on January 1, 2019. The borrower made the required payments during 2019 and 2020. However, during 2020 the borrower began to experience financial difficulties, requiring the bank to reassess the collectibility of the loan. On December 31, 2020, the bank has determined that the remaining principal payment will be collected as originally scheduled but the collection of the interest is unlikely. The bank did not accrue the interest on December 31, 2020 Present value of 1 at 8% For one period For two periods For three periods What is the carrying amount of the loan receivable on December 31, 2021> 0.926 0.857 0.794 A.2,000,000 O B.1,925,640 C.1,640,360 D.1,783,00 O

Solid Bank loaned P5,000,000 to a borrower on January 1, 2018 The terms of the loan require principal payments of P1,000,000 each year for 5 years plus interest at 8%. The first principal and interest payment is due on January 1, 2019. The borrower made the required payments during 2019 and 2020. However, during 2020 the borrower began to experience financial difficulties, requiring the bank to reassess the collectibility of the loan. On December 31, 2020, the bank has determined that the remaining principal payment will be collected as originally scheduled but the collection of the interest is unlikely. The bank did not accrue the interest on December 31, 2020 Present value of 1 at 8% For one period For two periods For three periods What is the carrying amount of the loan receivable on December 31, 2021> 0.926 0.857 0.794 A.2,000,000 O B.1,925,640 C.1,640,360 D.1,783,00 O

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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