Jules, Inc. issued a 4-year, $75,000, zero-interest-bearing note to Reed Company on January 2, 2025, and received cash of $44,406. The full balance of the Note is due on January 2, 2029. The implicit interest rate is 14%. An amortization table for this note applies as follows: Beg Prin Interest Ending Principle $44,406 6217 $50,623 $50,623 7087 $57,710 $57,710 8079 $65,789 $65,789 9211 $75,000 For the year ending December 31, 2027, what amounts will Jules have recorded to the following elements of the accounting equation? Here is an example of the format:
Jules, Inc. issued a 4-year, $75,000, zero-interest-bearing note to Reed Company on January 2, 2025, and received cash of $44,406. The full balance of the Note is due on January 2, 2029. The implicit interest rate is 14%. An amortization table for this note applies as follows: Beg Prin Interest Ending Principle $44,406 6217 $50,623 $50,623 7087 $57,710 $57,710 8079 $65,789 $65,789 9211 $75,000 For the year ending December 31, 2027, what amounts will Jules have recorded to the following elements of the accounting equation? Here is an example of the format:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Jules, Inc. issued a 4-year, $75,000, zero-interest-bearing note to Reed Company on
January 2, 2025, and received cash of $44,406. The full balance of the Note is due
on January 2, 2029. The implicit interest rate is 14%. An amortization table for this
note applies as follows:
Beg Prin Interest Ending Principle
$50,623
$44,406 6217
$50,623 7087
$57,710 8079
$65,789 9211
$57,710
$65,789
$75,000
For the year ending December 31, 2027, what amounts will Jules have recorded to
the following elements of the accounting equation?
Here is an example of the format:
$x,xxx increase OR $x,xxx decrease or $0 no change
The way to approach this problem is to draw out the accounting equation. Then fill in
the boxes. The boxes read left to right.
Current assets
A
A
A
A
A/
A Long-term assets
Current liabilities
Long-term liabilities
Operating expenses
Non-operating expenses
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