Question

Indigo Inc. had the following long-term receivable account balances at December 31, 2019.

Note receivable from sale of division		$1,800,000
Note receivable from officer		439,100

Answer 1

Answer Page: No 0 a long term receivables section of Indigo's balance sheet cat dec 21, 2020;- --> Face value of nobe as of Mayi, 2019 = $1800,000 Installment oreceived on May 1, 2020 $ $ 600,000 Balance amount of note, as of dec 31, 2020 = 1800,000 - 600.000 $1200,000 Trstallment received on May 1, 2011 = $ 600,000 Balance of long term portion as of dec 31,2000 - 1200,000 - 600,000 = $600,000 .. Balance of long term postion as of dec 31,2020 = $ 600,000 -> Face value of nobe as of April 1, 2020 = $102000 Impoted interest - 102000 - [102000 x 0,826) = 102000 – 84252

= $14748 Page No ③ April 1, 2020 = 102000 – 17748 . Balance as of = $ 84252 Interest earned up to dec 31, 2000 - 84252 ¥ 10%x* - $6319 ( Aprilitol .dec 31 9 months Balance of note as of dec 3122020 = 84253 + 6319 = $90571 ri Balance of note as of dec 31, 2020 = $90571 Contract selling price as of Joly 1, 2020 = $200,000 Down payment on Tuly , 2020 = $ 60,000 Balance as of dec 31, 2020 = 200,000 – 60,000 - $140,000 Interest due as of July 1, 2001 a 45125-( 140,000 89"} = 45125 - 12600 = $ 32525

Long term Page No ③ portion as of dec 31, 2024 = 140.000 – 32525 = $107475 .: Long term portion as of dec 31,2034 $107445 Long - term oreceivables section of balance sheel dee 3), 2020 Particular Amount $ 600,000 84. note greceivable from sale of diviõion due to annu al installment of $600,000 to May 1, 2020 vreduced by current installment 74. Note receiveuble from officer , due dec 31, 20 Collateralized by 10,000 shares of ridigue's Incos common stock with a fair value of $504,988 Non - interest bearing note from sale of patent net of 10% imputed interest , due April 1 Installment contract receivable at dec 31,2020 Long term portion $439,100 & 90571 $107445 Total long term receivables $1237146

@ Page No 4 Schedule showing current position of long-term receivables interest receivable that would appear on in indigos balance Sheet wat dec.31, 2020 Interest accrued from May 1, 2020 to dec 31, 2020 = (1800,000 – 600,000) x8.* - 1200,000 X 8.7.x8 I May todech 8 months - # 18cG CƠ Xo•08 x 8 = $ 64000 Interest accrued from July 1, 2010 to dec. 31, 2020 = # 14,0,000 x 7 x 6, =$6300 fi: July ! Handeling ( 6 months) :: Interest accrued from Joly, to dec 31, 2020 = $6300

Page. No Particular Amount Current petion of long termen receivables Nobe vreceivable from scele division $ 600,000 Installment contract receivable 4(3a525) Total current portion of long term meceivables $632525 Acerved interest receivable Note receivable from sale division $64000 Indballment contract receivable $6300 Total current portion of long term Jieceivable 1 $ 70300 Schedule showing interest grewerbe from long term receivables that would appear on indigera income statement for the year o ended dance 2020 :- Interest earned from Jan 1, 2020 to dec 31, 2020 = 439100x8% Y = $35128

. Page. No® Interest earned from Jan 1, 2020 to May 1, 2020 = 1800,000 X 8%.X = $48000 fi: Jap) to May}} 4 months Interest earned from May , 2020 to dec 31, 2020 = 1200,000 X 8%. X. 2 = $ 64000 ... Total interest income - 48000 +64000 = $112000 Interest revenue from long term receivables for year ended dec 31,20 Particular Amount Interest income Note Breceivable from sale of division $112000 Note receivable from sale of patent $6319 Note receivable from officers $ 48000 Installment contract receivable from sale of land $ 6300 Total interest Encome. for the year ended dec 31, 2020 $142619