6 Cond Lich Normal al > Credit “a Debit tC * offset Lede Raw Mobrid OY L Goned Ascck Ree Spin Terns tC FOB shippig peidk © ee Finicted 6 Destination Pipe oe. \e @ Ate na & Se bnekon Notes. Illustrative Problem 1: The balance of Pepper Company/s accounts payable account on December 31, 2021 was P 1,225,000, net of P 25,000 debit balances, before the following information was considered: * Goods shipped FOB destination on December 21, 2021 from a vendor to the company were lost in transit. The invoice cost of P 45,000 was recorded by the Company. + Goods were in transit fom a vendor to the company on December 31, 2021. The invoice cast was P 60,000 and the goods were shipped FOB shipping point on December 28, 2021. The company received and recorded the goods on January 6, 2022. + Goods shipped to the company, FOB shipping point on December 20, 2021 from a vendor were lost in transit. The invoice price was P 50,000. + On December 27, 2021, a vendor authorize the company to return, for full credit, goods shipped and billed at P 35,000 ‘on December 20, 2021. A P 35,000 credit memo was received and recorded by the company on January 6, 2022, Required: What amount should it report as accounts payable in its December 31, 2021, statement of financial position? a, 1,325,000 «. 1,370,000 1,250,000 4, 1,280,000Nofee Pagcble. ~ igued 9 Go pote trade oF Nentrade- Hees fooble hel Manner Gos Mees (ot Pn. Beet ) Shoel ferry ( £ Notes Re eble ace. Value Noles Pay Fac Vole ARs ER 3) pe le Cosh Prien. Fave aca 4 ‘ected Be Reset valve GNR FER P)ITAIBNP te cach Pree ESV ee zetia SA repens rece Nominal Rte FaceNolve Face < Nive Face Value fon fre x Peed ae . Som 4) $blectue fe eee OP ee . soced eqs, SH bak face OE Cllng Bale 30f9Ilistrative 2 Paper Company borrowed P 1,000,000 on Octobe 1,202, by signin @P 000000, 12%, 7-month note Require {,How much is the initial measurement of the note payable? 2, How muchis the interest expense atthe end of 2020? 3, How much is the carrying amount ofthe note on December 31, 20202 Ilistrative 3: On Nay 1, 2029, Peper Corporation purchased apiece euipment ram Ran Cmpany by suing a 14%, one-year note forP 320000 Ther ro eget cash rie fr thi eoupment, but the market rte of intrest on ilar notes is 6 The presen value of using 8's for! periods 09289, Required: {, Prepare the journal entry onthe date of issuance, 2,Prepae the adjusting journal entry a the end ofthe year, 3, How much is the carrying amount of the note (excluding interest payable) on December 31, 20242Illustrative 4: On April 1, 2028, Pepper Company issued a P 3,000,000, 12% promissory note for a machinery purchased, Equal principal amount of P 1,000,000 plus interest on the unpaid balance of the principal are payable annually every March 31 starting March 31, 2029, Required: 1,How much is the initial carrying amount of the notes payable? 2, Assuming Pepper Company is using the calendar year: a, How much is the carrying amount of the note on December 31, 2028? b, How much is the interest payable on December 31, 2028? ¢ How much is the interest expense on December 31, 2028? 3, Assuming Pepper Company is using the fiscal year: a, How much is the carrying amount of the note on March 31, 20287 b, How much is the interest payable on March 31, 2028? ¢. How much is the interest expense on March 31, 2028? Illustrative 5: On January 1, 2028, Pepper Company issued aP 300,000, 12% pamissry note far a machiery purchased, Theinterestis payable every December 31 whl he princial is payable afte 3 years Maret rat f interests 10%, Present valu factor of sig 10% for 3 periods is 0.7513 whe the present value factor of ordinary annuity off using 10% for 3 petod is 2.4868, Required, 1, How much is the intial carrying amount ofthe note on January 1, 2028? 2. How much i the interest expense forthe year 2028? 4 Prepare an amortization table,Illustrative 6: On January 1, 2028, Pepper Corporation sued a thes-yar,P 4,000,000, noninterest bearing promissory note fr a machinery purchased, The equivalent cash re ofthe machinery xii isP3008,259 The company uses the calendar year ats accounting period The efetve interest rat i 10%, Required: 1, How much the intial carrying amount of the note? 2. Prepare an amortization table, Ilustrative 7: On January 1, 2028, Peper Corporetion issued a tree mA noninterest Dearing promissory ki : efor a machinery purchased The note i payable i instalments of PN, OOT very Decerber 3, starting Decent 2028. The efective interest rte is 10 and the present value of iy zh ty of 1 sing 10% for 3 periods i 2.4869, Required: 1, How much isthe intial carrying amount ofthe note? 2. Prepare an amortization table,