Reference no: EM132837932
The Vigan Company included the following in its notes receivable as of December 31, 2020:
Note receivable from sale of land P 880,000
Note receivable from consultation 1,200,000
Note receivable from sale of equipment 1,600,000
In connection with your audit, you were able to gather the following transactions during 2020 and other information pertaining to the company's notes receivable:
- On January 1, 2020, Vigan Company sold a tract of land. The land, purchased 10 years ago, was carried on Vigan Company's books at a value of P500,000.
- Vigan received a non-interest-bearing note for P880,000. The note is due on December 31, 2021. There is no readily available market value for the land, but the current market rate of interest for comparable notes is 10%.
- On January 1, 2020, Vigan Company finished consultation services and accepted in exchange a promissory note with a face value of P1,200,000, a due date of December 31, 2022, and a stated rate of 5%, with interest receivable at the end of each year. The fair value of the services is not readily determinable and the note is not readily marketable. Under the circumstances, the note is considered to have an appropriate imputed rate of interest of 10%.
- On January 1, 2020, Vigan Company sold equipment with a carrying amount of P1,600,000 to X Company. As payment, X gave Vigan Company a P2,400,000 note. The note bears an interest rate of 4% and is to be repaid in three annual installments of P800,000 (plus interest on the outstanding balance). The first payment was received on December 31, 2020. The market price of the equipment is not reliably determinable. The prevailing rate of interest for notes of this type is 14%.
Problem 1: The consultation service fee revenue that should be recognized in 2020 is?
Problem 2: The gain on sale of equipment that should be recognized in 2020 is?
Problem 3: The noncurrent notes receivable as of December 31, 2020 is?
Problem 4: The current portion of long-term notes receivable as of December 31, 2020 is?
Problem 5: The interest income to be recognized in 2020 is?
|
Calculate the cost of goods sold for the askew company
: In addition, you determine that the June 30, 2021, inventory balance is $41,600. Calculate the cost of goods sold for the Askew Company
|
|
Sara conclusion logical conclusion
: Based on what you now know about statistical inference, is Sara's conclusion a logical conclusion? Why or why not?
|
|
Compute the balance of a investment in b account
: Income is $40,000 and dividends are $20,000 for year 2014. Present clear steps to compute the balance of A's Investment in B account as of 12/31/2014.
|
|
Should the analysis be different on ios vs android
: What are mobile forensics and do you believe that they are different from computer forensics? Should the analysis be different on iOS vs Android?
|
|
What current portion of long-term notes receivable
: What current portion of long-term notes receivable as of December 31, 2020 is? The land, purchased 10 years ago, was carried on Vigan Company
|
|
Describe critical issues in preparing a budget
: Discuss some of the critical issues in preparing a budget for a multinational enterprise (MNE) and global enterprises? As technology revolutionizes.
|
|
Segmentation analysis
: Develop innovative and sustainable solutions to strategic marketing challenges. Develop familiarization with marketing segmentation techniques.
|
|
Set schedule of interest expense and discount amortization
: Interest is payable annually on January 1. Set up a schedule of interest expense and discount amortization under the straight-line method
|
|
Why the quality of audit evidence is determined
: Why the quality of audit evidence is determined by the choice of audit procedure and the assertion most at risk of material misstatement.
|