Matt Corporation had a specific receivable from a customer in the amount of P600,000 as

of December 31, 2019. In 2020, the customer informed Matt Corporation that servicing

of its payable will be made once there is a significant improvement in their financial

capabilities. Since there are no available historical data relating to similar borrowers, Matt

Corporation uses its experienced judgment to estimate the amount of impairment loss.

Reasonable estimate revealed that the fair value of the receivable as of December 31, 2020

represents 40% of the outstanding receivable.

What amount of impairment loss on its receivable should Matt report for 2020?

Instruction: Write in your own handwriting using a 10-12 column worksheet if you have any

or intermediate paper. Use black/blue ballpen. Show solutions in good accounting form. All

amounts should be captioned, with no abbreviations. Submit a picture of your work by turning it

in. Make sure that it is properly and clearly captured (not upside down, portrait orientation)

Remember to solve it on your own, it is ungraded but part of formative assessment (10%).