On January 1, 2024. Byner Company purchased a used tractor. Byner paid 55,000 down and signed a naninterest bearing note requiring 542, 000 to be paid on December 31, 2026 The fair value of the tractor is not determinable. An interest rate of 11% properly reflects the time value of money for this type of loan agreement. The company's fiscal year-end is December Note: Use tables, Excel, or a financial calculator. (FV of 51, PV of $1. FVA of S1, PVA of $1, FVAD of St and PVAD of $1) Required: Prepare the journal entry to record the acquisition of the tractor. How much interest expense will the company include in its 2024 and 2025 income statements for this note? What is the amount of the liability the company will report in its 2024 and 2025 balance sheets for this note?
On January 1, 2024. Byner Company purchased a used tractor. Byner paid 55,000 down and signed a naninterest bearing note requiring 542, 000 to be paid on December 31, 2026 The fair value of the tractor is not determinable. An interest rate of 11% properly reflects the time value of money for this type of loan agreement. The company's fiscal year-end is December Note: Use tables, Excel, or a financial calculator. (FV of 51, PV of $1. FVA of S1, PVA of $1, FVAD of St and PVAD of $1) Required: Prepare the
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