al payments of $21,980, based on an interest rate of 9% are to be made every December 31, beginning with December 2020.  Compute the value of the Note at 1/1/20.  Following are appropriate factors from tables:    Table %   /  n Present Value of annuity due $1 Present Value

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
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Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...
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QUESTION 40

  1. On January 1, 2020, Smith Company signed a six-year Note for the acquisition of equipment. Annual interest and principal payments of $21,980, based on an interest rate of 9% are to be made every December 31, beginning with December 2020.  Compute the value of the Note at 1/1/20.  Following are appropriate factors from tables:

       Table

    %   /  n

    Present Value of annuity due $1

    Present Value of ordinary annuity of $1

    Present value of $1

    Future Value of ordinary annuity of $1

    9%/6

    4.88965

    4.48592

    .59627

    7.52333

       

    $101,975.34

       

    $98,600.52

       

    $107,474.51

       

    $131,880

     

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