Question
On January 1, 2020, FJ Co. sold machinery with historical cost of P6,000,000 and accumulated depreciation of P2,500,000 in exchange for a 3-year, 6%, P3,000,000
On January 1, 2020, FJ Co. sold machinery with historical cost of P6,000,000 and accumulated depreciation of P2,500,000 in exchange for a 3-year, 6%, P3,000,000 note receivable. Principal is due January 1, 2023 but interests are due semi-annually every December 31.
The prevailing effective interest rate for this type of note is 10%.
How much is the interest income in 2022?
a. P281,192
b. P180,000
c. P271,784
d. P291,565
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Financial Reporting and Analysis Using Financial Accounting Information
Authors: Charles H. Gibson
13th edition
1285401603, 1133188796, 9781285401607, 978-1133188797
