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What is the carrying value of face value note at december

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Problem 1: On January 1, 20x8, CLI Corp. purchased land by issuing P1 million non-interest bearing note payable after 3 years. The company also purchased an equipment by issuing a non-interest promissory note that requires three annual installment payments of P100,000 every December 31. The interest rate charged on the notes is 10%. The present value of P1 at 10% for 3 periods is 0.75131 while the present value of an ordinary annuity of P1 at 10% for 3 periods is 2.4868. What is the carrying value of the P300,000 face value note at December 31, 20x8?

a. P273,548

b. P148,680

c. P173,548

d. P248,680

Reference no: EM132673956

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