How much is credited to deferred income

Assignment Help Accounting Basics
Reference no: EM132600087

Questions -

Q1. On January 1, 2019, an entity received from the government a P 5,000,000 three-year, zero-interest loan evidenced by a promissory note. The prevailing rate of interest for a loan of this type is 10%. The present value of 1 at 10% is .75 for three periods. How much is credited to deferred income upon the receipt of the grant?

Q2. Tangerine Company acquired P3,000,000 face value 10% bonds as financial asset at amortized cost, on June 30, 2018 for P3,210,000, excluding brokerage of P150,000 and accrued interest. The bonds pay interest semiannually on May 1 and November 1. The remaining life of the bonds on the date of acquisition is 3 years. Straight-line amortization is employed. On December 31, 2018, the bonds were sold for P3,500,000 plus accrued interest. What is the gain on the sale of the bonds?

Q3. Broadway Company purchased a building on January 1, 2020 for P10,000,000. The building has been depreciated using the straight-line method with a 25-year useful life and no residual value. On December 31, 2023, Broadway is evaluating the building for possible impairment. The building has a remaining useful life of 15 years and is expected to generate cash inflows of P700,000 per year. The present value of an ordinary annuity of 1 at 8% for 15 periods is 8.56. The fair value of the building on December 31, 2023 is P5,300,000. What amount should be recognized as impairment loss on December 31, 2023?

Q4. On April 1, 2019, an entity purchased machinery for P3,300,000. The machinery has an estimated useful life of five years with residual value of P300,000. Depreciation is computed by the sum of the years' digits method. What is the depreciation expense for 2020? *

Q5. Genuine Company was granted a patent on January 1, 2020, and appropriately capitalized P450,000 of related costs. Genuine was amortizing the patent over its estimated life of 15 years. During 2023, Genuine paid P150,000 in legal costs in successfully defending an attempted infringement of the patent. After the legal action was completed, Genuine sold the patent to the plaintiff for P750,000. Genuine's policy is to take no amortization in the year of disposal. In its 2023 income statement, what amount should Genuine report as gain from sale of patent?

Reference no: EM132600087

Questions Cloud

Determine the allocation of income at the end : On January 2, 2018, Jeffrey invests $82,000 cash for a 20 percent interest in the partnership. Determine the allocation of income at the end of 2018
Estimate target enterprise value or ev : Based on 679.1 million shares outstanding, estimate the intrinsic value per share and compare it with Target's stock price on January 31, 2012, of $50.81.
Estimate the free cash flows to the firm for free cash inc : Estimate Free Cash Inc.'s year 3 terminal value. Estimate the free cash flows to the firm for Free Cash Inc. for each of the next three years.
What is the amplitude a of wave : A fisherman notices that his boat is moving up and down periodically without any horizontal motion, owing to waves on the surface of the water.
How much is credited to deferred income : The present value of 1 at 10% is .75 for three periods. How much is credited to deferred income upon the receipt of the grant
What will be the expected equity return or cost of equity : What will be the expected equity return (or cost of equity) for a firm that has a cost of capital of 10 percent, a cost of debt of 6 percent
Analyse performance reports against planned objectives : Why should you review and evaluate the business's pre-existing strategic, business and operational plans - List three internal stakeholders you might consult
What is the maximum and minimum current drawn : A circuit is constructed with three 5 W resistors. What is the maximum and minimum current drawn from a 12 V battery
Explain what has probably happened : On her income tax return, some of this expense is not reported and the balance is deducted in 2 different places. Explain what has probably happened

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd