6. On 1/1/2018, Jambo Group makes a loanto Marie Co. and receives in exchange afive-year, $50,000 note bearing interest at 6percent annually (on 31/12 of every year).The market rate of interest for a note ofsimilar risk is 12 percent.Calculate the amount of Interest revenuethat will be recognized on 31/12/2018.

Interest revenue that will be recognized can be computed as follows:

/1/2018, Jambo Group makes a loa to Marie Co. and receives in exchange a five-year, $50,000 note bearing interest at percent annually (on 31/12 of every year). 6. On The market rate of interest for a note of similar risk is 12 percent. Calculate the amount of Interest revenue that will be recognized on 31/12/2018.

/1/2018, Jambo Group makes a loa to Marie Co. and receives in exchange a five-year, $50,000 note bearing interest at percent annually (on 31/12 of every year). 6. On The market rate of interest for a note of similar risk is 12 percent. Calculate the amount of Interest revenue that will be recognized on 31/12/2018.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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1. On January 1, 2022, Balance Bar Co. lends Bio Foods $100,000 in exchange for a $100,000, 5-year note bearing interest at 8 percent annually. The market rate of interest for a note of similar risk is also 8 percent. a. How does Balance Bar record the receipt of the note? b. And how does Balance Bar record the receipt of interest at the end of the first year? c. At the end of the second year?
On January 1, 2019, Bank Dhofar issued CD in Muscat Securities Market which will mature in October 30, 2020. The CD pays 8 % interest rate. Calculate the interest earned on this CD with face value of 100000. Assume all month to be of 30 days. Select one: a. None of these b. 4835.50 OMR C. 5325.40 OMR d. 5260.27 OMR
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Cullumber Corporation issued a 4-year, $38,000, 4% note to Greenbush Company on January 1, 2020, and received a computer that normally sells for $30,773. The note requires annual interest payments each December 31. The market rate of interest for a note of similar risk is 10%. Prepare Cullumber’s journal entries for (a) the January 1 issuance and (b) the December 31 interest. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No.DateAccount Titles and ExplanationDebitCredit(a) (b)
XYZ Company is a dealer of equipment. On January 1 2020, the entity sold an equipment in exchange for non-interest bearing note requiring three annual payments of P500,000. The first payment was made on December 31, 2020. The market interest rate for similar notes was 9% PV of 1 at 9% for 3 periods 0.772183 PV of an ordinary annuity of 1 at 9% for 3 periods 2.531295 Required: a. Complete the amortization table Date Annual Collection Interest Income Principal Present Value Jan 1, 2020 1,265,647.33 Dec. 31 2020 _____________ _____________ _________ ___________ Dec. 31 2021 _____________ _____________ __________ ___________ Dec. 31 2022 ______________ _____________ __________ 0.00 b. Provide the journal entries to record the sale of equipment on January 1,…
A 5-year promissory note for $3200 issued on September 15, 2018, with interest at 6.5% compounded annually, was sold on December 1, 2019, at 5% compounded semi-annually. What is the sale price (proceeds) of the note?
On January 1, 2021, The Corporation sold goods to Adobo Company. Adobo signed a noninterest-bearing note requiring payment of P600,000 annually for seven years. The first payment was made on January 1, 2021.The prevailing rate of interest for this type of note at date of issuance was 10%.· PV of an ordinary annuity of 1 at 10% for 6 period- 4.36· PV of an ordinary annuity of 1 at 10% for 7 period- 4.87What is the carrying amount of the note receivable on January 1, 2021?
On June 8, Williams Company issued an $74,068, 8%, 120-day note payable to Brown Industries. Assuming a 360-day year for your calculations, what is the maturity value of the note? When required, round your answer to the nearest dollar. a.$79,993 b.$76,043 c.$74,068 d.$5,925
At 1 June 2017 bank Muscat issued CD in Muscat securities market with face value of 10000 OMR. This CD will mature in 10 November 2019. The CD pays 8 percent interest rate. Calculate the interest payment on this CD.
1. CJ, Inc. issued a promissory note to AJ, Inc. in the amount of $400,000 on January 1, 2014, the due date is December 31, 2018. The note has a stated rate of 4%. Interest is due each year on December 31. The current yield rate of interest is 8%. a) What is the present value of the note. b) What entry would AJ, Inc. journalize for the issuance of the note? |
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