A Bank granted a loan to a borrower in the amount of P5,000,000 on January 1, 2021, The interest rate on the loan is 10% payable annually starting December 31, 2021. The loan matures in five years on December 31, 2025. The Bank incurs P39,400 of direct loan origination cost and P10,000 of indirect loan origination cost. In addition, The Bank charges the borrower an 8-point nonrefundable loan origination fee. The carrying amount of the loan as of January 1, 2021 is The effective interest rate of the loan is (provide answer in two decimal places) The interest income to be recognized in 2021 is The carrying amount of the loan as of December 31, 2021 is
A Bank granted a loan to a borrower in the amount of P5,000,000 on January 1, 2021, The interest rate on the loan is 10% payable annually starting December 31, 2021. The loan matures in five years on December 31, 2025. The Bank incurs P39,400 of direct loan origination cost and P10,000 of indirect loan origination cost. In addition, The Bank charges the borrower an 8-point nonrefundable loan origination fee. The carrying amount of the loan as of January 1, 2021 is The effective interest rate of the loan is (provide answer in two decimal places) The interest income to be recognized in 2021 is The carrying amount of the loan as of December 31, 2021 is
Chapter5: Introduction To Business Expenses
Section: Chapter Questions
Problem 61P
Related questions
Question
A Bank granted a loan to a borrower in the amount of P5,000,000 on January 1, 2021, The interest rate on the loan is 10% payable annually starting December 31, 2021. The loan matures in five years on December 31, 2025. The Bank incurs P39,400 of direct loan origination cost and P10,000 of indirect loan origination cost. In addition, The Bank charges the borrower an 8-point nonrefundable loan origination fee.
The carrying amount of the loan as of January 1, 2021 is
The effective interest rate of the loan is (provide answer in two decimal places)
The interest income to be recognized in 2021 is
The carrying amount of the loan as of December 31, 2021 is
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT