Reference no: EM133184520

Questions -

Q1. On January 1,2020, ABC Company sold its equipment costing 1,000,000 with accumulated depreciation of P 250,000 in exchange of a non-interesting bearing note amounting to P 1,500,000 payable in six equal annual installments starting on December 31,2020. There was no cash price equivalent for the equipment and the prevailing market rate of interest for similar notes is 15%. For present value factors, do not round off. How much is the interest revenue for the year 2024?

Q2. On January 1,2020, ABC Company sold its equipment costing 1,000,000 with accumulated depreciation of P 250,000 in exchange of a non-interesting bearing note amounting to P 1,500,000 payable in six equal annual installments starting on December 31,2020. There was no cash price equivalent for the equipment and the prevailing market rate of interest for similar notes is 15%. For present value factors, do not round off. How much should the notes receivable be initially recognized in the books of ABC Company?

Q3. ABC Company is engaged in the sale of jewelries that are being distributed in some malls located in Metro Manila. The company's accounting assistant prepares monthly bank reconciliation. At August 31,2020, cash receipts and cash disbursements per general ledger Cash in Bank account of ABC Company are P 321,000 and P 265,000, respectively. The bank statement for the same month indicates that only P 302,000 in deposits were received during the month and checks clearing the bank were P 326,000. The July 31,2020 bank reconciliation showed deposits in transit of P 95,000. Outstanding checks at August 31,2019 were P 125,800. How much were the outstanding checks at July 31, 2020?