Solutions:
What is the carrying amount of notes receivable in December 31, 2021 statement of financial
Position?
1, 500, 000 + 1, 500, 000 (0.03) (5) (0.680)
= P1, 173, 000.00
What is the computed impairment loss related to the instrument?
Carrying amount/Principal Amount
P7, 500, 000
Present Value of Loan
P6, 535, 000
Impairment Loss
P964, 500
What is the total present value of loan in December 31, 2021?
Dec 31 2024 (637, 500 x 0.794) = 506, 175
Dec 31 2025 (637, 500 x 0.735) = 468, 562.5
Dec 31 2026 (637, 500 x 0.681) = 434, 137.5
Dec 31 2027 (8, 137, 500 x 0.630) = 5, 126, 625
Total present Value of loan
P6, 535, 500
How much is the interest income to be recorded in December 31 2022?
(6, 535, 500) (8.50%)
= P555, 517.50
How much is the interest income to be recorded in December 31 2023?
6, 535, 500 x 8.50% = 515, 517.50
515, 517.50 + 6, 535, 500 = 7, 091,017.50
7, 091,017.50 x 8.50% = 602, 736.49
On June 1, 2021, Yorme Company loaned Dave P1, 500, 000 on 18% note, payable in ten annual
installments of P150, 000 beginning January 1, 2022. Interest on the note is payable on the first day
of each month beginning July 1, 2021. Dave made timely payments through November 1, 2021. On
January 1, 2022, Yorme received payment of the first payment of the first principal installment
plus all interest due. On December 31, 2021, what is the accrued interest receivable on the loan?
(2/12) (18%) (1, 500, 000)
= P45, 000