What is the carrying amount of the note on december

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Question - Nakakainis company acquired a packaging machine from Badtrip Corporation. Badtrip completed the construction of the machine on January 1, 2029. In payment for the P3 million machine. Nakakainis issued a 4 year interest bearing note to be paid in four equal payments at the end of each year. Interest is 10% of the unpaid balance to be paid at the end of each year. Assume prevailing interest rate is 14%.

Required -

1. What is the carrying amount of the note on December 31 2030?

2. What amount should the note be recorded at January 1 2029?

Reference no: EM133132591

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