2

Use the following information for next two questions. Your company, a financial institution, loaned a total amount of P5,500,000 to a client in the beginning of 2020. The initial agreed terms on the loan included a 10% interest and annual payments of P1,100,000 every January 1. The client was able to pay the required interest payment in 2020 but not the principal payment. The client did not also pay for the P550,000 interest in 2021. You are preparing the annual financial statement of your company on December 31, 2021 and your client is experiencing financial difficulty, so you concluded that the loan to this client is impaired. You determined that the principal payments on the loan will be collected, but the collection of interest is unlikely. Your company did not accrue the interest on December 31, 2021. Expected collections: P1,700,000 in December 31, 2022; P2,000,000 in December 31, 2023; and P1,850,000 in December 31, 2024. How much is your company's impairment loss on December 31, 2021? 1 point P961,825 P5,500,000 P941,500 P550,000 How much will be the carrying value of the loan receivable on December 31, 2023? O P1,681,692 P1,590,785 P3,346,992 P4,588,175