Reference no: EM133077926

Questions -

Q1. Alam mo na Company sold one of its factories on January 1, 2020 for P7,000,000. The entity received a cash down payment of P1,000,000 and a 4 year, 12% note for the balance. The note is payable in equal annual payments of principal and interest of P1,975,400 payable on December 31 of each year until 2023. What is the carrying amount of the note receivable on December 31, 2020?

Q2. On December 31, 2020 Twice Company sold used equipment and received a non-interest- bearing note requiring payment of P500,000 annually for ten years. The first payment is due December 31, 2021 and the prevailing rate of interest for this type of note at date of issuance is 12%. Present value of 1 at 12% for 10 periods is .322 and Present Value of ordinary annuity of 1 at 12% for 10 periods is 5.65; What is the carrying amount of Note Receivable on December 31, 2020 statement of financial position?

Q3. Pina Company sold machinery to Rodney Company on January 1, 2020 for which the cash selling price was P7,582,000. Rodney entered into an installment sale contract with Pina Company at an interest rate of 10%. The contract required payments of P2,000,000 a year over five years with the first payment due on December 31, 2020. What amount of interest income should be reported in 2020?

Q4. Hello Company sold a piece of machinery with a list price of P1,600,000 to Archer Company on January 1, 2020. Archer Company issued a non interest bearing note of P1,700,000 due in one year. Hello Company normally sells this type of machinery for 90% of list price. What amount should be recorded as interest revenue?