21 Company A lends $50,000 to Company B and receives a $50,000, four-year note with a 6% stated annual interest rate. The annual cash interest payments are $50,000 x 0.6 = $3,000. The market rate for similar quality notes is 6%.Assuming an annual interest rate of 6% is appropriate, the present value of the principal of the note is $50,000 x 0.7921 = $39,605, and the present value of the cash interest payments is ($3,000 x 3.4651) = $10,395What is the carrying amount of this note when issued?$50,000$10,395O $39,605O $53,000

Carrying Amount = Present Value of the Principal + Present Value of Interest Payments Carrying…

Answered: 21 Company A lends $50,000 to Company B…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 27E

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17. Walnut company received from a customer an 1-year, P200,000 note bearing annual interest of 8%. After holding the note for 8 months,Walnut discounted the note at a local bank at an effective rate of 12%. What is the maturity value of the note? a. 216,000 b. 169,500 c. 200,000 d. 226,000
On June 8, Williams Company issued an $72,000, 7%, 120-day note payable to Brown Industries. Assuming a 360-day year, what is the maturity value of the note? Round your answer to the nearest whole dollar. a. $5,040 b. $73,680 c. $77,040 Od. $72,000
TORR, Inc. issues a $600,000, 9%, five-year note payable on January 1, 20X1. If the monthly payment is $12,455, what is the note's carrying value after the first month's payment is made on January 31, 20X1? Select one: a. $600,000 b. $592,045 c. $593,540 d. $595,500 e. $587,545
41
Give note's principal
On June 8, Williams Company issued an $80,000, 5%, 120-day note payable to Brown Industries. Assuming a 360-day year, what is the maturity value of the note? When required, round your answer to the nearest dollar. a. $82,600 b. $84,000 c. $81,333 d. $88,200
TORR, Inc. issues a $600,000, 9%, five-year note payable on January 1, 20X5. If the monthly payment is $12,455, what is the note's carrying value after the first month's payment is made on January 31, 20X5? Select one: a. $593,540 b. $587,545 c. $600,000 d. $592,045 e. $595,500 Clear my choice
9. The Sample Company discounts a $100,000 note receivable on 15 May 20x2. The following facts are known: Date of signing 3/31/x2 Due date 6/30/x2 Interest rate 8% per year Discounted on 5/15/x2 Discount rate 12% per year Find the following: a) Maturity value b) Proceeds
Assuming a 360-day year, when a $14,700, 90-day, 12% interest-bearing note payable matures, total payment will be ______ .Round your answer to the nearest whole dollar. a.$1,764 b.$15,141 c.$441 d.$16,464
5. A 180-day simple interest note was signed on March 15, 20xx with a face value of 65,000 at 8.25% per annum. The same was discounted at 11% in a bank on June 15,20xx, Find the discount amount and the proceeds.
Ramos Company has a 90-day note that carries an annual interest rate of 8%. If the amount of the total interest on the note is equal to $700, what is the note's principal? a. $8,750 b. $35,000 c. $50,400 d. $22,400
21.A 90-day, 15% interest bearing note was discounted to a bank at 18% after the note was held for 50 days. The proceeds received from the bank upon discounting would be the maturity value less a. maturity value less the discount at 18% for 50 days. b. maturity value less the discount at 18% for 40 days. c. maturity value less the discount at 15% for 50 days. d. face value less the discount at 18% for 40 days.

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