Reference no: EM132926532

Questions -

Q1. On December 31, 2020, EDSA company is in financial difficulty and cannot pay a note due that day. It is a 600,000 note with 60,000 accrued interest payable to Y Inc. X agrees to accept from Note, a building that has a fair value of 590,000, an original cost of 530,000, and accumulated depreciation of 130,000. Under IFRS, what amount should be reported as gain on extinguishment of liability?

Q2. On January 1, 2021 EDSA company issued 9% bonds with face amount of 4,000,000 which mature on January 1, 2030. the bonds were issued for 3,756,000 to yield 10% resulting in bond discount of 244,000. The entity used the interest method of amortizing bond discount . Interest is payable annually on December 31. What is the carrying amount of bonds payable on December 31, 2020?

Q3. X company, lessor , leased a machinery to Y company under a four - year operating lease. The yearly rental for 2020,2021,2022 and 2023 is 100,000 , 150,000, 200,000 and 250,000, respectively. Rentals are payable at the end of each month, All rental payments within the year were made when due. What amount should be reported as rent income 2020?