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What is the carrying amount of the loan as of january

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Question - Fisher Lending Corporation approved a loan in the amount of P5,000,000 on January 1, 2018. The interest rate on the loan is 10% payable annually starting December 31, 2018. The loan matures in 5 years on December 31, 2022. Fisher incurs P39,400 of direct loan origination cost and P10,000 of indirect loan origination cost. In addition, Fisher charges the client an 8-point non-refundable loan origination fee. Compute for the following requirements. Round off present values to 4 decimal places and final answers to nearest hundred.

Required -

1. What is the carrying amount of the loan as of January 1, 2018?

2. What is the effective rate of the loan? write the number only for the percentage. Example 10 instead of 10%

3. How much is the interest income to be recognized in 2018?

4. What is the carrying amount of the loan as of December 31, 2018?

Reference no: EM133169528

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