Reference no: EM132815622

Problem 1: On December 1, 2020 Pozurrubio Company assigned on a nonnotification basis accounts receivable of P5,000,000 to a bank in consideration for a loan of 90% of the receivables less a 5% service fee on the accounts assigned. Pozurrubio signed a note for the bank loan. On December 31, 2020, Pozurrubio collected assigned accounts of P3,000,000 less discount of P200,000. Pozurrubio remitted the collections to the bank in partial payment for the loan. The bank applied first the collection to the interest and the balance to the principal. The agreed interest is 1% per month on the loan balance. In its December 31, 2020 balance sheet, Pozurrubio should report note payable as a current liability at __________________ ?