KERVIN REY G.

JACKSON BSA-1
INTACC-1

Problem 1
Requirement 1
Solutions:
January 1, 2019:
Cash ₱ 2,640,000
Discount on loans payable ₱ 360,000
Loans payable ₱ 3,000,000
To record the loan obtained from EIGHT Bank

Requirement 2
Solutions:
Face value ₱ 3,000,000
Less: Interest deducted in advance (₱3,000,000 x12%) ₱ (360,000)
Net cash proceeds ₱ 2,640,000

Requirement 3
Solutions:
Loans payable balance of WELGA Company ₱ 3,000,000
Less: Partial payment on June 30, 2019 ₱ (700,000)
Less: Partial payment on December 31, 2019 ₱ (850,000)
Unpaid balance of loans payable ₱ 1,450,000

Requirement 4
Solutions:
Accounts receivable of WELGA Company ₱ 3,500,000
Less: Collection of accounts receivable on June 30, 2019 ₱ (700,000)
Less: Collection of accounts receivable on December 31, 2019 Balance ₱ (850,000)
of accounts receivable ₱ 1,950,000

Problem 2
Solutions:
Accounts Receivable - assigned ₱ 1,000,000
x 90%
Net cash proceeds ₱ 900,000

January 1, 2020
Accounts receivable - assigned ₱ 1,000,000
Accounts receivable ₱ 1,000,000
To separate the assigned accounts receivable.
KERVIN REY G. JACKSON BSA-1
INTACC-1
Cash ₱ 900,000
Loans payable ₱ 900,000
To record the loan obtained from the company.

July 1, 2020
Cash ₱ 250,000
Accounts receivable - assigned ₱ 250,000
To record the collection of assigned accounts receivable

Loans payable ₱ 250,000

Cash ₱ 250,000
To record partial payment of loan.

December 31, 2020

Cash ₱ 250,000
Accounts receivable - assigned ₱ 250,000
To record the collection of assigned accounts receivable.

Loans payable ₱ 250,000

Interest expense ₱ 120,000
Cash ₱ 370,000

Problem 3
Requirement 1
Solutions:
Accounts receivable - factored ₱ 1,500,000
x 80%
Gross cash proceeds ₱ 1.200,000
Less: Service charge 0
₱ 1,200,000
Net cash proceeds

Requirement 2
Solutions:
Net cash proceeds ₱ 1,200,000
Carrying value of accounts receivable (₱ 1,500,000 - ₱ 180,000) Loss on ₱ 1,320,000
factoring of the accounts receivable ₱ (120,000)

Requirement 3 Solution:
Cash ₱ 1,200,000
Allowance for doubtful accounts - Accounts receivable ₱ 180,000
Loss on factoring of accounts receivable ₱ 120,000
KERVIN REY G. JACKSON BSA-1
INTACC-1
Accounts receivable ₱ 1,500,000
To record the sale of accounts receivable

Problem 4
Requirement 1
Solutions:
Face value of notes receivable ₱ 2,000,000
Add: Total interest (₱ 2,000,000 x 10% x 12/12) ₱ 200,000
Maturity value of notes receivable ₱ 2,200,000
Less: Discount (₱ 2,000,000 x 12% x 7/12) ₱ (154,000)
Net proceeds of notes receivable ₱ 2,046,000

Requirement 2
Solutions:
Face value of notes receivable ₱ 2,000,000
Add: Accrued interest (₱ 2,000,000 x 10% x 5/12) ₱ 83,333
Carrying amount of notes receivable ₱ 2,083,333
Net cash proceeds ₱ 2,046,000
Loss on discounting of notes receivable ₱ (37,333)

Requirement 3
Solutions:
Cash ₱ 2,046,000
Loss on discounting of notes receivable ₱ 37,333
Notes receivable ₱ 2,000,000
Interest income ₱ 83,333
To record the the discounting notes receivable with
ELEVENTH Bank on a without recourse basis.

Problem 5
Requirement 1
Solutions:
Face value of notes receivable ₱ 1,089,000
Add: Total interest (₱1,089,000 x 8% x 6/12) Maturity ₱ 43,560
value of notes receivable ₱ 1,132,560
Less: Discount (1,132,560 x 10% x 3/12) ₱ (28,314)
Net cash proceeds ₱ 1,104,246

Face value of notes receivable ₱ 1,089,000

Add: Accrued interest (1,089,000 x 8% x 3/12) Carrying ₱ 21,780
amount of notes receivable ₱ 1,110,780
Net cash proceeds ₱ 1,104,246
Loss on discounting of notes receivable ₱ (6,534)
KERVIN REY G. JACKSON BSA-1
INTACC-1

Cash ₱1,104,246
Loss in discounting of notes receivable ₱ 6,534
Notes receivable ₱ 1,089,000
Interest income ₱ 21,780
To record the discounting of notes receivable with
THRIFT Bank on a with recourse basis accounted for
as conditional sale.

Notes receivable discounted ₱ 1,089,000

Notes receivable ₱ 1,089,000
To record the derecognition of the notes receivable
discounted account.

Requirement 2
Solutions:
Face value of notes receivable ₱ 1,089,000
Add: Total interest (1,089,000 x 8% x 6/12) Maturity ₱ 43,560
value of notes receivable ₱ 1,132,560
Less: Discount (1,132,560 x 10% x 3/12) ₱ (28,314)
Net cash proceeds ₱ 1,104,246

Face value of notes receivable ₱ 1,089,000

Add: Accrued interest (1,089,000 x 8% x 3/12) Carrying ₱ 21,780
amount of notes receivable ₱ 1,110,780
Net cash proceeds Interest ₱ 1,104,246
expense ₱ 6,534

Cash ₱ 1,104,246
Interest expense ₱ 6,534
Liability for notes receivable ₱ 1,089,000
discounted
Interest income ₱ 21,780
To record the discounting of notes receivable with
THRIFT Bank on a with recourse basis accounted for as
a secured borrowing.

Notes receivable discounted ₱ 1,089,000

Notes receivable ₱ 1,089,000
To record the derecognition of the notes receivable
discounted account.