On December 31, 2020, Buffalo Company signed a $1,278,400 note to Carla Bank. The market interest rate at that time was 10%. The stated interest rate on the note was 8%, payable annually. The note matures in 5 years. Unfortunately, because of lower sales, Buffalo’s financial situation worsened. On December 31, 2022, Carla Bank determined that it was probable that the company would pay back only $767,040 of the principal at maturity. However, it was considered likely that interest would continue to be paid, based on the $1,278,400 loan.

Determine the amount of cash Buffalo received from the loan on December 31, 2020. (Round present value factors to 5 decimal places, e. g. 0.52513 and final answer to 0 decimal places, e. g. 5,275.)

Amount of cash Buffalo received from the loan $enter a dollar amount of cash Buffalo received from the loan
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Prepare a note amortization schedule for Carla Bank up to December 31, 2022. (Round answers to 0 decimal places, e. g. 5,275.)

Note Amortization Schedule
(Before Impairment)

Date

Cash
Received

Interest
Revenue

Increase in
Carrying
Amount

Carrying
Amount of
Note

12/31/20

$enter a dollar amount
12/31/21

$enter a dollar amount $enter a dollar amount $enter a dollar amount enter a dollar amount
12/31/22

enter a dollar amount enter a dollar amount enter a dollar amount
enter a dollar amount

Determine the loss on impairment that Carla Bank should recognize on December 31, 2022. (Round present value factors to 5 decimal places, e. g. 0.52500 and final answer to 0 decimal places, e. g. 5,275.)

Loss due to impairment $enter the Loss due to impairment in dollars