Kingbird Corp. sells idle machinery to Enyart Company on July 1, 2020, for $46,000. Kingbird agrees to repurchase this equipment from Enyart on June 30, 2021, for a price of $49,680 (an imputed interest rate of 8%). (a) Prepare the journal entry for Kingbird for the transfer of the asset to Enyart on July 1, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Kingbird Corp. sells idle machinery to Enyart Company on July 1, 2020, for $46,000. Kingbird agrees to repurchase this equipment from Enyart on June 30, 2021, for a price of $49,680 (an imputed interest rate of 8%). (a) Prepare the journal entry for Kingbird for the transfer of the asset to Enyart on July 1, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 14RE: On January 1, 2019, Boater Company issues a 20,000 non-interest-bearing, 5-year note for equipment....

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On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
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