On January 1, Snipes Construction paid for earth - moving equipment by issuing a $490,000, 3 - year note that specified 3% interest to be paid on December 31 of each year. The equipment's retailcash price was unknown, but it was determined that a reasonable interest rate was 6%. At what amount should Snipes record the equipment and the note? What journal entry should it record forthe transaction?

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On January 1, Snipes Construction paid for earth - moving equipment by issuing a $490,000, 3-year note that specified 3% interest to be paid on December 31 of each year. The equipme cash price was unknown, but it was determined that a reasonable interest rate was 6%. At what amount should Snipes record the equipment and the note? What journal entry should it re the transaction?

On January 1, Snipes Construction paid for earth - moving equipment by issuing a $490,000, 3-year note that specified 3% interest to be paid on December 31 of each year. The equipme cash price was unknown, but it was determined that a reasonable interest rate was 6%. At what amount should Snipes record the equipment and the note? What journal entry should it re the transaction?

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

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 14RE: On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank....

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