Assuming that both Cheyenne Company and Ayayai Bank use the effective-interest method toamortize the discount, prepare the amortization schedule for the note. (Round answers to 0decimal places, e.g. 5,275. Do not leave any field blank. Enter 0 for the amounts.)SCHEDULE FOR INTEREST AND DISCOUNT AMORTIZATION-EFFECTIVE-INTEREST METHOD$1,224,300 Note Issued to Yield 8%Date1/1/1712/31/1712/31/1812/31/1912/31/2012/31/21Total$CashPaidIAInterestExpenseLA$DiscountAmortizedLACarryingAmount ofNoteClick if you would like to Show Work for this question: Open Show Work On January 1, 2017, Cheyenne Company issued a $1,224,300, 5-year, zero-interest-bearingnote to Ayayai Bank. The note was issued to yield 8% annual interest. Unfortunately, during2018 Cheyenne fell into financial trouble due to increased competition. After reviewing allavailable evidence on December 31, 2018, Ayayai Bank decided that the loan was impaired.Cheyenne will probably pay back only $816,200 of the principal at maturity.

A note is a financial instrument which is issued to pay a certain sum of money at a specified date.…

On January 1, 2017, Cheyenne Company issued a $1,224,300, 5-year, zero-interest-bearing note to Ayayai Bank. The note was issued to yield 8% annual interest. Unfortunately, during 2018 Cheyenne fell into financial trouble due to increased competition. After reviewing all available evidence on December 31, 2018, Ayayai Bank decided that the loan was impaired. Cheyenne will probably pay back only $816,200 of the principal at maturity.

On January 1, 2017, Cheyenne Company issued a $1,224,300, 5-year, zero-interest-bearing note to Ayayai Bank. The note was issued to yield 8% annual interest. Unfortunately, during 2018 Cheyenne fell into financial trouble due to increased competition. After reviewing all available evidence on December 31, 2018, Ayayai Bank decided that the loan was impaired. Cheyenne will probably pay back only $816,200 of the principal at maturity.

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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