On January 1, 2023, Karen Hong lent $64612 to Ben Bachu. A zero-interest-bearing note (face amount, $86000) was exchangedsolely for cash; no other rights or privileges were exchanged. The note is to be repaid on December 31, 2025. The market rate ofinterest for a loan of this type is 10%. To the nearest dollar, and using the effective interest method, how much interest revenue shouldMs. Hong recognize in 2023?$19383$6461$25800○ $8600

Answered: On January 1, 2023, Karen Hong lent…

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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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 December 31, 2020, Larkspur Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Larkspur Co. agreed to accept a $ 252,100 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 10%. Larkspur is much more creditworthy and has various lines of credit at 6%.Click here to view factor table. https://education.wiley.com/content/Kieso_Intermediate_Accounting_17e/media/simulations/interest_rate_tables.pdf
On December 1, 2022, Old Car Co. borrowed money at the bank by signing a 90-day non-interest-bearing note for $30,000 that was discounted at 10%. Which of the following entries is correct?
A debtor owes $3,675 on August 24th. The Note Holder sells the Note to a THIRD PARTY on May 17th, who wants an 11% Simple Interest Return. What does the Debtor Owe on August 24th? What does the THIRD PARTY pay for the note? (Use Banker's Rule, Round to the nearest penny, NO dollar signs, USE commas)
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On December 31, 2020, Sarasota Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Sarasota Co. agreed to accept a $337,600 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 11%. Sarasota is much more creditworthy and has various lines of credit at 5%. Click here to view factor table. (a) Your answer is partially correct. Prepare the journal entry to record the transaction of December 31, 2020, for the Sarasota Co. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Dec. 31, 2020 Account Titles and Explanation Notes Receivable Service Revenue Discount on Notes Receivable Debit…
Max Corp. sold goods for $36,000 on July 17, 2020, and accepted a 12%, 90-day note. On August 1, the note was sold to a bank at a 15% discount rate. Required: a. Compute the proceeds. Assume a 360-day year. b. If the maker dishonored the note at maturity, prepare the entry for Max Corp. assuming $75 of bank protest fees. If an amount box does not require an entry, leave it blank.
On January 1, 2020, Ann Price loaned $157773 to Joe Kiger. A zero-interest-bearing note (face amount, $210000) was exchanged solely for cash; no other rights or privileges were exchanged. The note is to be repaid on December 31, 2022. The prevailing rate of interest for a loan of this type is 10%. The present value of $210000 at 10% for three years is $157773. What amount of interest income should Ms. Price recognize in 2020? $44350. $63000. $15777. $21000.
On December 31, 2020, Ed Abbey Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Abbey Co. agreed to accept a $200,000 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 10%. Abbey is much more creditworthy and has various lines of credit at 6%. For step 1, why is it worked out 1/1.1 and answer divided by 1.1 to get 0.826446? Can you explain it to me step by step please. It is PV at 10% for end of year 2. I am having trouble understanding the process. Can you please explain it to me?
GH Traders wrote off R1 750 which represented 20% of the amount owed by a debtor. The debtor settled the balance on her account by means of an electronic funds transfer. These transactions have not yet been recorded. Which of the following statements is correct in respect of the above transactions? OA. The Debtors Control account will decrease by R7 000. OB. The debtor owed R8 750. OC. The Bank account will be credited with R7 000. OD. The amount received from the debtor was R1 400.
Ireland Corporation obtained a $62,000 note receivable from a customer on June 30, 2021. The note, along with interest at 5%, is due on June 30. 2022. On September 30, 2021, Ireland discounted the note at Cloverdale bank. The bank's discount rate is 8%. What amount of cash did. Ireland receive from Cloverdale Bank? Multiple Choice $58,094. $57,040. $62.775. < Prev 15 of 15 Next

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