On December 31, 2012, Grin Company finished consultation services and accepted inexchange a promissory note with a face value of P600,000, a due date of December 31, 2015,and a stated rate of 5%, with interest receivable at the end of each year. The fair value of theservices is not readily determinable and the note is not readily marketable. Under thecircumstances, the note is considered to have an appropriate imputed rate of interest of 10%.The following interest factors are provided:Interest RateTable Factors For Three Periods10%1.33100.751325%Future Value of 11.15763Present Value of 1.86384Future Value of Ordinary Annuity of 1Present Value of Ordinary Annuity of 13.152503.310002.723252.48685Instructions(a) Determine the present value of the note.(b) Prepare a Schedule of Note Discount Amortization for Green Company under the effectiveinterest method. (Round to whole dollars.)

Consultation Services are a very important in business perspective point of view. Basically in…

Answered: On December 31, 2012, Grin Company…

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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On January 1, 2021, Bonita Industries sold property to Sandhill Company. There was no established exchange price for the property, and Sandhill gave Bonita a $4500000 zero-interest-bearing note payable in 5 equal annual installments of $900000, with the first payment due December 31, 2021. The prevailing rate of interest for a note of this type is 9%. The present value of the note at 9% was $3500730 at January 1, 2021. What should be the balance of the Discount on Notes Payable account on the books of Sandhill at December 31, 2021 after adjusting entries are made, assuming that the effective-interest method is used? $713252. $684204. $999270. $0.
On April 17, 2016, Westside Co. accepted a 65,000, 8%, 90-day note from a customer. On June 11, the note was discounted at 10% under a conditional sale. At maturity date, the note was dishonored and the bank charged 1,250 protest fee. If on July 26, 2016, the customer pays the account due plus 8% interest. How Much Should Westside report as Loss from Notes Receivable Discounted and the total amount received on July 26,2016?
On January 1, 2015, Oxford Company finished consultation services and accepted in exchange a promissory note with a face value of $600,000 and a due date of December 31, 2017. The stated rate of interest is 5% with interest receivable at the end of each year through 12/31/17. Assume an effective interest rate of 10% is implicit in the agreed-upon price. The effective amortization method is used. Oxford's journal entry on 1/1/15 to record service revenue will include: Select one: O a. A credit to Notes Receivable for $600,000 Ob. A credit to Service Revenue for $600,000 OC A debit to Discount on Notes Receivable for $74,602 Od. A credit to Service Revenue for $525,398 O e A credit to Discount on Notes Receivable for $52,145
On December 31 , 2018 Nicholas Co. is in financial difficulty and cannot pay a note due that day . It is a $3,300,000 8% issued at par note, payable to Key Bank. Key Bank agrees to accept from Nicholas equipment that has a fair value of 1,450,000, originally costing $2,400,000, with accumulated depreciation of $1,250,000. Key Bank also extends the maturity date to December 31, 2021, reduces the face amount of the note to $1,250,000, and reduces the interest rate to 6%, with interest payable at the end of each year. a. Nicholas should recognize a gain or loss on the transfer of the equipment of: b. At the end of each of the next three years Nicholas records the $ 75,000 interest paid to Key Bank as a: c. In determining the carrying value of the note at December 31, 2018 Key Bank uses an effective interest rate equal to: d. Key Bank records a loss on restructuring of: e. In recording the loss on restructuring, Key bank:
what is notes recievable for On December 31;2025, Blue Inc. rendered services to Beghun Corporation at an agreed price of $106,641, accepting $41,800 down and agreeing to accept the balance in four equal installments of $20,900 receivable each December 31 . An assumed interest rate of 11% is imputed. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
XYZ Company is a dealer of equipment. On January 1 2020, the entity sold an equipment in exchange for non-interest bearing note requiring three annual payments of P500,000. The first payment was made on December 31, 2020. The market interest rate for similar notes was 9% PV of 1 at 9% for 3 periods 0.772183 PV of an ordinary annuity of 1 at 9% for 3 periods 2.531295 Required: a. Complete the amortization table Date Annual Collection Interest Income Principal Present Value Jan 1, 2020 1,265,647.33 Dec. 31 2020 _____________ _____________ _________ ___________ Dec. 31 2021 _____________ _____________ __________ ___________ Dec. 31 2022 ______________ _____________ __________ 0.00 b. Provide the journal entries to record the sale of equipment on January 1,…
May the creditor validly refuse acceptance of the payment of a judgment obligation made by the judgment debtor consisting of P50,000.00 in a certified check, such as a Cashier’s Check, and P13,130.00 in cash which the latter deposited with the Sheriff before the date of the scheduled public auction sale? Explain.
provide the answer
6. On December 31, 2010, Chelsea Co. provides a service for its customer Villas Boas Co. inexchange for a promissory note requiring five annual payments of $1,000 each. The paymentsare to occur on December 31 of each year beginning on December 31, 2011. The note does notspecify any interest, and there is no market for the note. Based on the credit worthiness of VillasBoas Co. and the length of the note, it is estimated that Villas Boas Co. would have to pay 10%interest if it borrowed a similar amount from a bank. The amount of interest revenue recognizedby Chelsea for the year ended December 31, 2013 is:a. $174b. $249c. $317d. $347
On 1 July 2019, Sitara Ltd sells a computer to Kitara Ltd. The computer cost Sitara Ltd $9000. Rather than selling the item for a cash price or a short-term claim for cash of $12 009, Sitara Ltd accepts a promissory note that requires Kitara Ltd to make four annual payments of $4000 each, the first one to be made on 30 June 2020. The difference between the gross receipts and the current sales price represents interest revenue earned by Sitara Ltd over the note period. The rate implicit in the arrangement is 12 per cent. Provide a journal entry with a clear distribution of instalment payment into interest and principal amount as of 30/6/2021.
On January 2, 2025, Oriole Inc. sells goods to Sheridan Company in exchange for a zero-interest-bearing note with face value of $10,500, with payment due in 12 months. The fair value of the goods at the date of sale is $9,500 (cost $5,700). (a1) Prepare the journal entry to record this transaction on January 2, 2025. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Date Jan. 2, 2025 Jan. 2, 2025 Account Titles and Explanation (To record sales) (To record cost of goods sold) Debit Credit
am. 113.

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