Reference no: EM132975687

Questions -

Q1) Jak Company sold a tract of land with carrying amount of P3,000,000 to Gorgeous Company on July 1, 2019. P1,200,000 was collected on the date of sale, and the balance of P2,800,000 is collectible in four equal installments of P902,500, consisting of principal and 11% interest on the unpaid balance. The first annual installment is due on July 1, 2020. How much is interest income for the year ended December 31, 2020?

Q2) On September 1, Riva Co. assigns specific receivables totaling P750,000 to Pacific Bank as collateral on a P625,000, 12 percent note. Riva Co. will continue to collect the assigned accounts receivable. Pacific also assesses a 2 percent service charge on the total accounts receivable assigned. Riva Co. is to make monthly payments to Pacific with cash collected on assigned accounts receivable. Collections of assigned accounts during September totaled P260,000 less cash discounts of P3,500. What amount is owed to Pacific by Riva Co. for September collections plus accrued interest on the note to September 30?

Q3) On December 31, 2018, the 5-6 Financing Company assesses whether there is any objective evidence that its maturing loans receivables are impaired as of that date.

From Company A - Principal P4,000,000 and accrued interest receivable of P480,000, based on annual interest rate of 12%, original due date December 31, 2018. It has come to your attention that Company A, as of December 31, is undergoing bankruptcy proceedings and has negotiated for restructuring of its loan with 5-6 as follows: P1,120,000 annual payment with first payment due on December 31, 2019. No further interest will be collected during the extended four-year term.

Impairment loss to be recognized on December 31, 2018 on the receivable form Company A is?