PLKO Co. factored P160,000 accounts receivable to NCD Financing Corp on a with recourse basis on January 1, 2018. NCD charged a 4% service fee and retained a 10% holdback to cover expected sales returns. In addition, NCD charged 12% interest computed on a weighted average time to maturity of the receivables of 73 days over 365 days. PLKO Co. determines that the recourse obligation has a fair value of P3,000. How much is the loss on sale of receivables recognized on January 1, 2018 assuming the factoring was made on a casual basis?
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- NNN Company factored P5,000,000 of accounts receivable to ABC Company on July 1, 2020. Control was surrendered by NNN. ABC assessed a fee of 5% and retains a holdback equal to 20% of the accounts receivable. In addition ABC charged 12% computed on a weighted average time to maturity of the receivables of 30 days. 33.In the 2020 income statement, what amount should be reported as interest income? 34.In the 2020 income statement, what amount should be reported as gain or loss on sale of equipment?On October 31, 2020, JP Company engaged in the following transactions: Obtained a P500, 000, six month loan from BDO, discounted at 12%. The company pledged P500, 000 of accounts receivable as security for the loan. Factored P1, 000 000 of accounts receivable without recourse on a non notification basis with Meow Company. Meow charged a factoring fee of 2% of the amount of receivables factored and withheld 10% of the amount factored. What is the total cash received from the financing of receivables? * a. 1 320 000 b. 1 350 000 c. 1 380 000 d. 1 470 000On October 31, 2021 T Company engaged in the following transactions: [1] Obtained a P500,000, 6-month loan from BDO, discounted at 12%. The company pledged P600,000 of accounts receivable as security for the loan. [2] Factored P1,000,000 of accounts receivable without recourse on a notification basis with Home Credit Company. Home Credit charged a factoring fee of 5% of the amount of receivables factored and withheld 10% of the receivables factored. 1. What is the total cash received from the financing of receivables? 2.What is the amount of loss?
- Aye Company factored P600,000 of its accounts receivable to Sweet Company on October 1. Control was surrendered by Aye Company. The factor assessed a fee of 3% and retained a holdback equal to 5% of the accounts receivable. In addition, the factor charged 15% interest computed on a weighted average time to maturity of the accounts receivable of 54 days. (Use 365 days in the computation of interest). Questions: 1. What is the amount of cash initially received by Aye Company from the factoring?Answer 2. If all accounts are collected, what is the cost of factoring the accounts receivable?NNN Company factored P5,000,000 of accounts receivable to ABC Company on July 1, 2020. Control was surrendered by NNN. ABC assessed a fee of 5% and retains a holdback equal to 20% of the accounts receivable. In addition ABC charged 12% computed on a weighted average time to maturity of the receivables of 30 days. 31.NNN Company will receive and record cash of 32.Assuming all receivables are collected, NNN Company’s cost of factoring the receivables would beThe following transactions relate to A Inc. in 2020: Aug 1: Assigned P6,000,000 of accounts receivable to P. Ocampo Bank under a non-notification basis. The bank advanced 75% of the face value of the receivables less a service charge of P2,500. A signed a promissory note agreeing to pay monthly interest of 1% of the unpaid balance of the loan. Aug. 4: Issued a P60,000 credit memo for sales allowance granted to a customer whose account was assigned Aug 9. : Collected 50% of the face value of the assigned accounts. Sales discounts of 3% were granted to 60% of the face value of the collected accounts Aug. 20: Remitted the collection to P. Ocampo along with the monthly Aug. interest. The payment of the monthly interest was paid first out of the collection of assigned accounts receivable. What is the equity on the assigned accounts, as of August 31, 2020?
- On January 1, 2020, Blue Co. borrowed and received $ 507,000 from a major customer evidenced by a zero-interest-bearing note due in 4 years. As consideration for the zero-interest-bearing feature, Blue agrees to supply the customer’s inventory needs for the loan period at lower than the market price. The appropriate rate at which to impute interest is 9%. (a) Prepare the journal entry to record the initial transaction on January 1, 2020. (b) Prepare the journal entry to record any adjusting entries needed at December 31, 2020. Assume that the sales of Blue’s product to this customer occur evenly over the 4-year period. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)On December 1, 2021, Wonder Company assigned P400,000 of accounts receivable to Woman Company as a security for a loan of P335,000. Wonder Company charged a 2% commission on the amount of the loan; the interest rate on the note was 10%. During December, Wonder collected P110,000 on assigned accounts after deducting P380 of discounts. Wonder accepted returns worth P1,350 and wrote off assigned accounts totaling P2,980. how much cash did wonder receive from woman at the time of the transfer? what is the carrying value of the account receivable assigned of december 31, 20211. Bank CO approved a loan application of Client ME on January 1, 20A for P3,500,000. Client ME is required to pay 15% interest annually every December 31, from 20A until the principal is extinguished. Client ME has to make an equal annual principal payment of its obligation to commence December 31, 20A. An amount of P61,192 was paid by Client ME as its share from the origination fee totaling P161,192, and the rest was shouldered by the bank resulting to a 14.50% new effective interest rate. On December 31, 20A, the non-current portion of the loan receivable is
- KMC Inc. provided a loan to Jim Ltd on January 1st, 2016 and received in exchange a 4-year, $120,000 note bearing interest at 8% to be paid annually on December 31. The market rate of interest for financial instruments of similar risk is 2%. KMC Inc. financial year ends December 31 and the company uses the effective interest method to amortize discount and recognize interest revenue. Required: Round to nearest whole number d) Prepare the journal entry in KMC’s books to record the issuance of the note on January 1, 2016. e) Prepare KMC’s 4-year Note Amortization schedule. f) Prepare the journal entry KMC records on December 31, 2017.On January 1, 2025, Coronado Co. borrowed and received $150,000 from a major customer evidenced by a zero-interest-bearing note due in 4 years. As consideration for the zero-interest-bearing feature, Coronado agrees to supply the customer's inventory needs for the loan period at lower than the market price. The appropriate rate at which to impute interest is 9%. Prepare the journal entry to record the initial transaction on January 1, 2025. Prepare the journal entry to record any adjusting entries needed at December 31, 2025. Assume that the sales of Coronado's product to this customer occur evenly over the 4-year period and that the effective-interest method is used.KMC Inc. provided a loan to Jim Ltd on January 1st, 2016 and received in exchange a 4-year, $120,000 note bearing interest at 8% to be paid annually on December 31. The market rate of interest for financial instruments of similar risk is 2%. KMC Inc. financial year ends December 31 and the company uses the effective interest method to amortize discount and recognize interest revenue. Required: Round to the nearest whole number a) what is the face value of the note? b) Calculate the present value of the note. c) Is this note issued at par, discount or premium? d) Prepare the journal entry in KMC’s books to record the issuance of the note on January 1, 2016. e) Prepare KMC’s 4-year Note Amortization schedule. f) Prepare the journal entry KMC records on December 31, 2017.