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How much is the interest income recognized

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Question - On September 1, 2021, AA Company loaned P10,000,000 to BB Company. The loan is to repayable after 4 years. Interest on this loan is 5% annually every September 1 of each year starting 2022. Direct origination cost of P2,065,917 was paid by AA and direct origination fee was deducted to the proceeds received by BB Company. The interest effective on this loan is 2% after the origination costs and fees. How much is the interest income recognized in its 2022 income statement?

Reference no: EM133145853

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