An entity purchases goods for P250,000 under a special credit period of 1 year. The seller normally sellsgoods for P220,000 with a credit period of one month or 5% discount for cash basis.

Requirement:
1. What is the amount of purchases to be recorded?
2. Prepare journal entries for transaction.


PROBLEM B
On July 1. 2021 Gerald Company borrowed P1,500,000 and issued a one-year note payable. The lender"discounted the note at 8%".

Requirement:
1. What is the initial measurement of the notes payable?
2. Prepare journal entries for 2021 and 2022.

Answer rating: 100% (QA)

SOLUTION Solution for PROBLEM A The entity purchases goods for P250000 under a special credit period ... View the full answer