On July 1, 2019 J Corp acquired a machinery worth Php 2,500,000 from D Co. Term of the contract calls for a downpayment of Php 500,000 and signing a 2 year 10% note payable for the balance. Interest is payable quarterly. The existing loan agreement does not carry a provision to refinance. During September, J Corp was experiencing financial difficulty due to COVID-19 and was unable to pay the periodic interest. a. What amount of current liability should J Corp report in its December 31, 2019 balance sheet assuming D Co. agreed at balance sheet date not to demand payment as a consequence of the breach? b. What amount of current liability should J Corp report in its December 31, 2019 balance sheet assuming D Co. agreed to provide a grace period ending at least twelve months to rectify the breach? 2. A truck owned and operated by B Company was involved in an accident with an auto driven by Julia on January 12, 2019. B Company received notice on April 24, 2019 of a lawsuit for Php 800,000 damages for a personal injury suffered by Julia. B Company counsel believes it is reasonably possible that Julia will be successful against the company for an estimated amount in the range between Php 100,000 and Php 400,000. No amount within this range is a better estimate of potential damages than any other amount. It is expected that the lawsuit will be adjudicated in the latter part of 2020. What amount of loss should B Company accrue at December 31, 2019

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1 Cost of machinery php 2500000 downpayment php 500000 balance due php 20000000 interest rate 10 int... View the full answer