Calculate the net carrying value of the notes receivable on the books of ZER Finance, at the end of year one assuming that Zer is using effective interest method to amortize discount or premium on note receivable

Calculate the net carrying value of the notes receivable on the books of ZER Finance, at the end of year one assuming that Zer is using effective interest method to amortize discount or premium on note receivable

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

See similar textbooks

Related questions

Q: Determine the dollar settlement of the 3 x 6 FRA for the amount $300,000 assuming (a) the settlement…

A: A loan is a type of financial agreement whereby a lender gives a borrower a certain amount of money,…

Q: Use the amortization table to determine how much interest is paid in the first 4 months of the loan.…

A: The interest in the first 4 months of the loan will be total of interest of month 1, month 2, month…

Q: Calculate the finance charge (in $), the finance charge per $100 (in $), and the annual percentage…

A: The annual percentage rate is the rate of interest that is charged on the borrowed amount by the…

Q: te the following, using ordinary interest. (Use Days in a year table.) Note: Do not round…

A: Simple interest there is no interest on interest and there is no compounding of interest. In…

Q: Note: Round all answers to the nearest cent when necessary. Calculate the amount financed, the…

A: When funds are financed from outside, they carry a finance charge which is the cost of using those…

Q: A lending institution charges interest at the rate of 3.5% per quarter, a. What is the nominal…

A: Interest rate per quarter = 3.5% a. What is the nominal interest rate? Nominal interest rate…

Q: Evaluating alternative notesA borrower has two alternatives for a loan: (1) issue a $360,000,…

A: The financial position of the company can be arrived from the income statement prepared by the…

Q: What is the journal entry to record (for both the debtor and creditor) for refinancing a loan for…

A: Entries in the books of Debtor:

Q: Solve for maturity value, discount period, bank discount, and proceeds. Assume a bank discount rate…

A: In the period which are less than 1 year than calculations are done based on simple ordinary…

Q: Find the finance charge for a charge account with an average daily balance of $1213.58 and a monthly…

A: Finance Charge = Average Daily Balance x Monthly Interest rate

Q: On January 1, 2020, James Co. received a 10% five-year note from a customer. Interest paid is every…

A: The question is based on the concept of Financial Accounting.

Q: What is the APR if the monthly rate of interest a credit card company charges on outstanding…

A: Given: Monthly rate = 1.62%

Q: Calculate the bank discount and proceeds for the following simple discount notes. Usethe ordinary…

A: Notes are a financial instrument which is used by the borrower to borrow the fund or to purchase…

Q: Complete the following, using ordinary interest. (Use Days in a year table.) Note: Do not round…

A: The question is related to Time Value of Money. The simple Interest is calculated with the help of…

Q: Determine the interest rate earned on a $450 deposit when $475 is paid back in one year.

A: This question require us to compute the interest rate. Other details : Present value = $450 Future…

Q: Which of the following statement is true of amortization? The computation of loan amortization is…

A: We take loans to buy things that we cannot afford on our own. The loan is then repaid through fixed…

Q: Calculate the finance charge (in $), the finance charge per $100 (in $), and the annual percentage…

A: AMOUNT FINANCED = $17.910 NO OF PAYMENT = 48 MONTHLY PAYMENT = $550.47 TOTAL PAYMENT = $550.47 x 48…

Q: Interest on a note payable can be calculated by multiplying the amount owed by the interest rate by…

A: Interest on a Note payable the amount of interest currently owed to lenders. Interest payable is a…

Q: A bank quotes you a nominal interest rate of 12%, compounded monthly, on a savings account. What is…

A: Monthly nominal interest rate (r) = 0.01 (i.e. 0.12 / 12)Number of compounding in a year (n) = 12…

Q: Calculate the finance charge (in $), the finance charge per $100 (in $), and the annual percentage…

A: A loan is a financial arrangement in which one or more people, companies, or other entities lend…

Q: Calculate the finance charge (in $), the finance charge per $100 (in $), and the annual percentage…

A: amount financed = $50,000 no of payment = 60 monthly payment = $1,176.33 total payment = 60 x…

Q: Consider a $5,000, 6%, 180-day interest-bearing note and a non-interest- bearing note for the same…

A: The notes are used by borrowers for raising funds that are categorized as interest bearing and…

Q: How can we calculate the total annual interest payment for a credit card debt of $ 1,000?

A: We should pay the credit card bill by the end of credit free period to avoid interest charges upon…

Q: Complete the following, using ordinary interest. (Use Days in a year table.) Note: Do not round…

A: Given, Principal is $1500 Interest rate is 12%

Q: A loan with a nominal value of ($3000) payable after (250) days. The debtor paid the amount before…

A: The discount rate is the interest rate which is charged to commercial banks and other institution…

Q: Daayata Department Store wishes to discount two notes receivable arising from the sale of…

A: Maturity value of Note A = 50000 as there is no interest. Maturity value of Note B = 50000 + 50000…

Q: Calculate the table factor, the finance charge, and the monthly payment (in $) for the loan by using…

A: APR stands for Annual Percentage Rate. It is a measure of the cost of credit, expressed as a yearly…

Q: Calculate the finance charge (in $) and the annual percentage rate for the installment loan by using…

A: The finance charge is that charge which is paid by the borrower on the amount borrowed.

Q: Complete the following, using exact interest. (Use Days in a year table.) Note: Do not round…

A: Loan - $ 1300 Interest – 7% Date borrowed= May 20 Date repaid = August 23

Q: Purchase (Cash) Price $3,100 Down Payment 20% $ Amount Financed Monthly Number of Payment Payments…

A: Step 1 Deferred Payment An investment's right to postpone payments is known as a deferred payment…

Q: 1) When the amount earned on a deposit has become part of the principal at the end of a specified…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Complete the following, using ordinary interest. (Use Days in a year table.) Note: Do not round…

A: Maturity value The value an investor receives by holding a security for a specific period of time is…

Q: Complete the following, using ordinary interest. (Use Days in a year table.) Note: Do not round…

A: The borrower is the one who borrows money from the lender and the lender charges interest for the…

Q: LHONDA: CAN you HELP ME SOLUE THIS JUST SUME TIPS PLEASE ? Before you begin, print out all the pages…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Complete the following table for the simple discount notes. Use the ordinary interest method. (Round…

A: Given, Amount due on maturity = 3200 Discount rate = 6.25% Time = 125 days

Q: Find the finance charge on the following open-end charge using the unpaid balance method of…

A: Finance charge is the fee for borrowing. It is also known as cost of credit.

Q: Solve for maturity value, discount period, bank discount, and proceeds. Assume a bank discount rate…

A: Discount notes are a debt instrument used by companies to raise short-term debt. They do not offer…

Q: Statement I: In determining the interest income for the 2nd year of non-interest-bearing notes…

A: Answer:- Interest income definition:- Interest income can be defined as the difference between the…

Q: Note: Do not round intermediate calculations. Round the "Interest" and "Maturity value" to the…

A: Ordinary interest is simple interest based on year 360 days.Given,Principal is $1328Interest rate is…

Q: formula for computing interest on a note is: Principal of the notex Annual interest rate x Time…

A: Note is type of deposit and in this interest is paid on the maturity of bond and normally notes have…

Question

Lucky company borrowed an amount of
money from ZER Finance Co. In return,
ZER Finance Co received a $ 200,000,
4 year, 6% note from Lucky. On the
date of the transaction, the market rate
on interest was 8% for a similar note.
Instructions:
Calculate the net carrying value of the
notes receivable on the books of ZER
Finance, at the end of year one
assuming that Zer is using effective
interest method to amortize discount or
premium on note receivable
The following information might help
you:
Present value of a future sum factor,
6%, 4 years= 0.7921
Present value of a future sum factor,
8%, 4 years= 0.7350
Present value of an ordinary annuity
factor, 6%, 4 years= 3.5
Present value of an ordinary annuity
factor, 8%, 4 years= 3.3
(When writing your answer do not
use commas or sign of the dollar.
For example, if your answer is
$1,500, write it as 1500)
Answer:

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 4 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Check my wor Solve for maturity value, discount period, bank discount, and proceeds. Assume a bank discount rate of 9%. Use the ordinary interest method. (Use Days in a year table.) (Do not round intermediate calculations. Round your final answers to the nearest cent.) Face value Rate of Length of note Date note (principal) $26, 300 interest Maturity value Date of note discounted 9% 65 days Discount period Bank discount Proceeds March 17 April 20 days 24 $4 hp
Calculate the table factor, the finance charge, and the monthly payment (in $) for the loan by using the APR table, Table 13-1. (Round your answers to the nearest cent.)
Power Solutions Ltd. issues a $15,000,000, five-year, 4.5% bond with semi-annual interest payments. Underwriting costs, paid up front, are $960,00O. The bond sells at par. Required: 1. How much cash does Power receive when the bond is issued? Power receives 2. What is the effective interest rate on the bond? (Round your answer to the nearest whole percentage.) Effective interest rate per annum
The loan below was paid in full before its due date. (a) Obtain the value of h from the annual percentage rate table. Then (b) use the actuarial method to find the amount of unearned interest, and (c) find the payoff amount. Regular Monthly Payment $445.22 Remaining Number of Scheduled Payments after Payoff 6 APR 11.0% Click the icon to view the annual percentage rate table. (a) h=$ (b) The unearned interest is $ (c) The payoff amount is $ (Round to the nearest cent as needed.) (Round to the nearest cent as needed.)
Solve for maturity value, discount period, bank discount, and proceeds. Assume a bank discount rate of 9%. Use the ordinary interest method. (Use Days in a year table.) Note: Do not round intermediate calculations. Round your final answers to the nearest cent. $ Face value (principal) 27,200 Rate of interest 9% Length of note 60 days Maturity value Date of note August 23 Date note discounted September 18 Discount period Bank discount Proceeds eck
Calculate the amount financed, the finance charge, and the monthly payments (in $) for the add-on interest loan. (Round your answers to the nearest cent.)
A design studio received a loan of $4,250 at 3.90% compounded semi-annually to purchase a camera. If they settled the loan in 3 years by making quarterly payments, construct the amortization schedule for the loan and answer the following questions: a. What was the payment size? Question 4 of 6 Round to the nearest cent b. What was the size of the interest portion on the first payment?
Check my Solve for maturity value, discount period, bank discount, and proceeds. Assume a bank discount rate of 7%. Use the ordinary interest method. (Use Days in.a year table) (Do not round Intermediate calculations. Round your final answers to the nearest cent.) Maturity value Date of Rate of Interest Length of note Date note discounted Proceede Face value (principal) 60,600 Discount perlod Bank discount note 90 days May 13 |days June 4
What is he initial carrying value of the loans receivable as of Dec 31, 2019?
a. Use the appropriate formula to determine the periodic deposit. b. How much of the financial goal comes from deposits and how much comes from interest? Periodic Deposit Rate $? at the end of each month 3.5% compounded monthly Click the icon to view some finance formulas. a. The periodic deposit is $. (Do not round until the final answer. Then round up to the nearest dollar as needed.) Formulas b. S of the $220,000 comes from deposits and S comes from interest. (Use the answer from part (a) to find these answers. Round to the nearest dollar as needed.) A= In the provided formulas, P is the deposit made at the end of each compounding period, r is the annual interest rate of the annuity in decimal form, n is the number of compounding periods per year, and A is the value of the annuity after t years. P[(1+r)²-1] T Time 10 years A= nt P= Financial Goal $220,000 响 nt [(¹-3) - X SEX
Calculate the table factor, the finance charge, and the monthly payment (in $) for the loan by using the APR table, Table 13-1. (Round your answers to the nearest cent.) AmountFinanced Number ofPayments APR TableFactor FinanceCharge MonthlyPayment $800 18 16% $ $ $
How do interest expense and the carrying value of the note change over time for an installment note with fixed monthly loan payments?

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

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

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

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

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS