On January 1, 2020, Jasmin Co. had equipment costing P380,000 with accumulated depreciation of P160,000 on...
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On January 1, 2020, Jasmin Co. had equipment costing P380,000 with accumulated depreciation of P160,000 on the date of sale. Jasmin received as consideration for the sale, a P400,000 noninterest-bearing note, due January 1, 2023. There was no established exchange price for the equipment and the note had no ready market. The prevailing rate of interest for a note of this type at January 1, 2020 was 10% and 12% on December 31, 2020. In Jasmin's 2020 income statement, how much should be included for interest income? On January 1, 2020, Jasmin Co. had equipment costing P380,000 with accumulated depreciation of P160,000 on the date of sale. Jasmin received as consideration for the sale, a P400,000 noninterest-bearing note, due January 1, 2023. There was no established exchange price for the equipment and the note had no ready market. The prevailing rate of interest for a note of this type at January 1, 2020 was 10% and 12% on December 31, 2020. In Jasmin's 2020 income statement, how much should be included for interest income?
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I Step 1 i Present value of note on January 1 2020 Face value of note x present value factor 1 ... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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