On January 1 , 2 0 2 3 , P cheuse Lt e sold a fishing vessel
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Question:
On January Pcheuse Lte sold a fishing vessel to a customer in exchange for a fiveyear
promissory note with an annual interest rate of Interest only payments are due SEMIANNUALLY, on June and December The market rate for an equivalent loan to this customer would have been
Pcheuse Lte uses IFRS, has a December year end, and prepares adjusting entries annually.
Required:
a Calculate the amount of revenue to be recorded on January by Pcheuse Lte for the sale of the fishing vessel
i
Calculate using the present value tables in the textbook.
ii
Calculate using EXCEL PV formula. Copy your Excel formula to another cell as text so it can be viewed put in front of it for text.Remember that the payment and the future value must be negative.
b Prepare the journal entries for Pcheuse Lte at Jan June and Dec
Show all calculations.
C Prepare the note amortization schedule. Be sure to show the all the semiannual interest payments and the payment of the note on Jan
HINT: Interest rates are always quoted on an annual basis.
Related Book For
Advanced Financial Accounting
ISBN: 978-0132928939
7th edition
Authors: Thomas H. Beechy, V. Umashanker Trivedi, Kenneth E. MacAulay
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