What is the gain (or loss) from the derecognition of liability?
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Kochi Company showed the following data with respect to a matured obligation:
Notes payable 1,100,000
Interest payable 200,000
The company negotiated with the creditor for the settlement of the notes payable. The entity transferred a transportation vehicle with carrying amount of P800,000 and a fair value of P1,100,000. Assume that only the notes payable are to be extinguished, while the accrued interest is paid in cash together with the transportation vehicle. What is the gain (or loss) from the derecognition of liability?
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- On January 1, 2020, CPA Co. sold land with carrying amount of P1,8o00,000 in exchange for a 1o-month, 10% note with face value of P2,000,000. On May 1, 2020, the entity discounted the note with recourse. The bank discount rate is 12%. The discounting transaction is accounted for as a secured borrowing. On November 1, 2020, the maker dishonored the note receivable. The entity paid the bank the maturity value of the note plus protest fee of P10,000. On December 1, 2020, the entity collected the dishonored note receivable in full plus 12% annual interest on the total amount due. How much cash was collected on December 1? (Round off to two decimal places.)Japee, Inc. assigned P240,000 of its receivables to PJTC Finance company. A note payable was executed. The contract provided that PJTC would advance 85% of the gross amount of the receivables. The contract specified recourse and non-notification; therefore, Japee’s debtors continue to remit directly to it; the cash from customers is then remitted to the finance company. The cash remitted is first applied to the finance charges, with the remainder applied to the principal. During the first month, customers owing P164,000 paid cash, less sales returns and allowances of P6,400. The finance charge at the end of the first month was P1,400.How much is the disclosed equity in assigned accounts as of the end of the first month?On January 1 2020, Machete Company sold land with a carrying amount of P1 500 000 in exchange for a 9 month 10% note with face value of P2 000 000. The 10% rate properly reflects the time value of money for this type of note. On April 1 2020 the entity discounted the note with recourse. The bank discount rate is 12%. The discounting transaction is accounted for as a secured borrowing. On October 1 2020, the make dishonored the note receivable. The entity paid the bank the maturity value of the note plus the protest fee of P10 000. On December 31 2020, the entity collected the dishonored note receivable in full plus 12% annual interest on the total amount due. Required: Prepare journal entries to record the transaction.
- The entity sold P1,500,000 of accounts receivable for cash proceeds of P1,390,000. No bad debt allowance was associated with these accounts. On December 15, 2020, the entity assigned the remainder of the accounts receivable, P5,000,000 as of that date, as collateral on a P2,500,000, 12% annual interest rate loan. The entity received P2,500,000 less a 2% finance charge. None of the assigned accounts has been collected by the end of the year. Allowance for bad debts before adjustment, 12/31/2020 100,000 Estimated uncollectible, 12/31/2020 10% of accounts receivable Accounts receivable not including factored and assigned accounts 1,000,000 Accounts receivable – assigned 5,000,000 Accounts receivable – factored 1,500,000 28. What is the total amount of cash received from the financing of accounts receivable during the year? a. P3,840,000 b. P1,390,000 c. P3,890,000 d. P3,540,000 29. What total amount of accounts receivable should be reported as…10. Ebasan Company factored P5,000,000 of accounts receivable. Control was surrendered by the entity. The transaction met the criteria to be accounted for as sale but subject to recourse for nonpayment. The fair value of the recourse obligation is P250,000. The finance company assessed a fee of 6% and retained a holdback equal to 10% of the accounts receivable. In addition, the finance company charged 12% Interest computed on a weighted average time to maturity of the accounts receivable for 60 days. What total amount should be recognized initially as loss on factoring? A. 398,630 B. 898,630 C. 800,000 D. 648,630 11. What amount should be reported as loss on factoring assuming the accounts are fully collected by the factor? A. 398,630 B. 300,000 C. 550,000 D. 400,000The entity sold P1,500,000 of accounts receivable for cash proceeds of P1,390,000. No bad debt allowance was associated with these accounts. On December 15, 2020, the entity assigned the remainder of the accounts receivable, P5,000,000 as of that date, as collateral on a P2,500,000, 12% annual interest rate loan. The entity received P2,500,000 less a 2% finance charge. None of the assigned accounts has been collected by the end of the year. Allowance for bad debts before adjustment, 12/31/2020 100,000 Estimated uncollectible, 12/31/2020 10% of accounts receivable Accounts receivable not including factored and assigned accounts 1,000,000 Accounts receivable – assigned 5,000,000 Accounts receivable – factored 1,500,000…
- On December 1, 2022, Telon Corp. engaged the following transactions: •The company pledge P600,000 of its accounts receivable as a security for a P500,000 loan with Yupy Bank. •Factored P1,300,000 of accounts receivable without recourse on a notification basis with Yalong Finance Company. Yalong Finance charged a factoring fee of 10% of the amount of receivable factored and withheld 15% of the receivable factored. •A customer's P700,000, 7-month, 5% note receivable dated August 1, 2022 was discounted with Yummy Bank at 8% discount rate on a with recourse basis. How much is the total cash received from the financing of receivables?JKL Company factored P6,000,000 of accounts receivable to a finance entity at the beginning of current year. Control was surrendered by DEF Company. The factor accepted the accounts receivable subject to recourse for nonpayment. The fair value of the recourse obligation is P100,000. The factor assessed a fee of 3% and retained a holdback equal to 5% of the accounts receivable. In addition, the factor charged 15% interest computed on a weighted average time to maturity of the accounts receivable of 54 days. Assuming that all accounts are collected, what is the gain or (loss) on factoring the accounts receivable? *On Jan. 1, 20x1, an entity has an outstanding note payable with carrying amount of P 1,000,000. On this date, the debtor agrees to receive the equipment with historical cost of P 1,800,000, accumulated depreciation of P 900,000 and fair value of P 850,000 in full settlement of the note payable. Compute for the gain or loss on the derecognition of the notes payable:a. P 0b. P 150,000 gainc. P 50,000 lossd. P 100,000 gain
- GHI Company factored P6,000,000 of accounts receivable to a finance entity at the beginning of current year. Control was surrendered by DEF Company. The factor accepted the accounts receivable subject to recourse for nonpayment. The fair value of the recourse obligation is P100,000. The factor assessed a fee of 3% and retained a holdback equal to 5% of the accounts receivable. In addition, the factor charged 15% interest computed on a weighted average time to maturity of the accounts receivable of 54 days. Compute the amount of cash initially received from the factoring. *John's entity assigned P700,000 of accounts receivable to a bank under a nonnotification arrangement. The bank advances 80% less a service charge of P5,000. The entity signed a promissory note that provides for interest of 1% per month on the unpaid loan balance. The entry to record the assignment of accounts receivable will include a a. No entry needed b. Debit to accounts receivable-assigned, P700,000 c. Debit to accounts receivable-assigned, P555,000 d. Debit to accounts receivable-assigned, P560,000 e. Cannot determineOn January 1, 2022, Cornet Inc. loaned $187,825 to Pact Co. A zero-interest-bearing note (face amount, $250,000) was exchanged solely for cash; no other rights or privileges were exchanged. The note is to be repaid on December 31, 2024. The prevailing rate of interest for a loan of this type is 9%. What amount of interest income should Cornet recognize in 2022? $18,783 $16,904 $25,000 $22,500