COMPANY acquires a new

manufacturing equipment on January 1,

2016, on installment basis. The deferred

payment contract provides for a down

payment of P300,000 and an 8-year note for

P3,104,160. The note is to be paid in 8 equal

annual installment payments of P388, 020,

including 10% interest. The payments are to

be made on December 31 of each year,

beginning December 31, 2016. The

equipment has a cash price equivalent of

P2,370,000. Saxophone's financial year-end

is December 31.