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pls help me, thank you. China Bank granted a P1,000,000, 14% loan to ABC Co. on January 01, 2020. Interest payment is made every December
pls help me, thank you.
China Bank granted a P1,000,000, 14% loan to ABC Co. on January 01, 2020. Interest payment is made every December 31, and the principal will be paid on December 31, 2023. China Bank charged ABC Co. P10,000 for processing of the loan. The actual cost incurred in processing the loan is P70,747. Note: Use the whole PV Factor. Round off all computations to the nearest peso. Required: I. Give the carrying amount of the loan receivable on: - January 01, 2020 - December 31, 2020 - December 31, 2021 - December 31, 2022 - December 31, 2023 II. Give the journal entry to record: 2020 - January 01 Granting of the loan - January 01 Receipt of origination fee - January 01 Payment of direct origination cost December 31 Collection of interest - December 31 Amortization of direct origination cost 2021 - December 31 Collection of interest - December 31 Amortization of direct origination cost 2022 - December 31 Collection of interest - December 31 Amortization of direct origination cost 2023 - December 31 Collection of interest - December 31 Amortization of direct origination cost - December 31 Collection of Principal III. Prepare a partial balance sheet on December 31, 2021 Non-current Asset: Loan Receivable Add: Direct Origination Cost CHART OF ACCOUNTS: Cash Loan Receivable Direct Origination Cost Unearned Interest Income Interest Income China Bank granted a P1,000,000, 14% loan to ABC Co. on January 01, 2020. Interest payment is made every December 31, and the principal will be paid on December 31, 2023. China Bank charged ABC Co. P10,000 for processing of the loan. The actual cost incurred in processing the loan is P70,747. Note: Use the whole PV Factor. Round off all computations to the nearest peso. Required: I. Give the carrying amount of the loan receivable on: - January 01, 2020 - December 31, 2020 - December 31, 2021 - December 31, 2022 - December 31, 2023 II. Give the journal entry to record: 2020 - January 01 Granting of the loan - January 01 Receipt of origination fee - January 01 Payment of direct origination cost December 31 Collection of interest - December 31 Amortization of direct origination cost 2021 - December 31 Collection of interest - December 31 Amortization of direct origination cost 2022 - December 31 Collection of interest - December 31 Amortization of direct origination cost 2023 - December 31 Collection of interest - December 31 Amortization of direct origination cost - December 31 Collection of Principal III. Prepare a partial balance sheet on December 31, 2021 Non-current Asset: Loan Receivable Add: Direct Origination Cost CHART OF ACCOUNTS: Cash Loan Receivable Direct Origination Cost Unearned Interest Income Interest IncomeStep by Step Solution
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