A partial amortization schedule for a 5-year note payable that Mabry Company issued on January 1, Year 1, is shown as follows. Principal Accounting Balance Cash Period Year 1 Year 2 Year 3 Event No. January Payment 1 S 1. 2 133,000 110,329 85,844 Assets Applied to Interest Principal Applied to Required What rate of interest is Mabry Company paying on the note? Using a financial statements model like the one shown, record the appropriate amounts for the following two events: (1) January 1, Year 1, issue of the note payable. Balance Sheet Liabilities $ (2) December 31, Year 1, payment on the note payable. If the company earned $96,000 cash revenue and paid $57,600 in cash expenses in addition to the interest in Year 1, what is the amount of each of the following? (1) Net income for Year 1. (2) Cash flow from operating activities for Year 1. (3) Cash flow from financing activities for Year 1. What is the amount of interest expense on this loan for Year 4? 33,311 33,311 33,311 MABRY COMPANY Horizontal Statements Model Stockholder's Equity $ 10,640 8,826 6,868 Revenue $ 22,671 24,485 26,443 Income Statement Expense Net Income Statement of Cash Flow

A partial amortization schedule for a 5-year note payable that Mabry Company issued on January 1, Year 1, is shown as follows. Principal Accounting Balance Cash Period Year 1 Year 2 Year 3 Event No. January Payment 1 S 1. 2 133,000 110,329 85,844 Assets Applied to Interest Principal Applied to Required What rate of interest is Mabry Company paying on the note? Using a financial statements model like the one shown, record the appropriate amounts for the following two events: (1) January 1, Year 1, issue of the note payable. Balance Sheet Liabilities $ (2) December 31, Year 1, payment on the note payable. If the company earned $96,000 cash revenue and paid $57,600 in cash expenses in addition to the interest in Year 1, what is the amount of each of the following? (1) Net income for Year 1. (2) Cash flow from operating activities for Year 1. (3) Cash flow from financing activities for Year 1. What is the amount of interest expense on this loan for Year 4? 33,311 33,311 33,311 MABRY COMPANY Horizontal Statements Model Stockholder's Equity $ 10,640 8,826 6,868 Revenue $ 22,671 24,485 26,443 Income Statement Expense Net Income Statement of Cash Flow

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

Sh.15.

A partial amortization schedule for a 5-year note payable that Mabry Company issued on January 1, Year 1, is shown as
follows.
Accounting
Period
Year 1
Year 2
Year 3
Principal
Balance
Cash
January Payment
1
Event
No.
$
1.
2.
133,000
110,329
85,844
Assets
Applied Applied
to
to
Interest Principal
Required
What rate of interest is Mabry Company paying on the note?
Using a financial statements model like the one shown, record the appropriate amounts for the following two events:
(1) January 1, Year 1, issue of the note payable.
(2) December 31, Year 1, payment on the note payable.
If the company earned $96,000 cash revenue and paid $57,600 in cash expenses in addition to the interest in Year 1, what
is the amount of each of the following?
(1) Net income for Year 1.
(2) Cash flow from operating activities for Year 1.
(3) Cash flow from financing activities for Year 1.
What is the amount of interest expense on this loan for Year 4?
$
Balance Sheet
Liabilities
33,311
33,311
33,311
3
Stockholder's
Equity
MABRY COMPANY
Horizontal Statements Model
$ 10,640 $ 22,671
8,826
24,485
6,868
26,443
Revenue
Income Statement
Expense
Net Income
Statement of
Cash Flow

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