On January 1, year 2, Connor Corporation signed a $100,000 noninterest-bearing note due in three years at a discount rate of 10%. Connor elects to use the fair value option for reporting its financial liabilities. On December 31, year 2, Connor's credit rating and risk factors indicated that the rate of interest applicable to its borrowings was 9%. The present value factors at 10% and 9% are presented below. PV factor .751 10%, 3 periods PV factor .826 10%, 2 periods PV factor .909 10%, 1 periods PV factor .772 9%, 3 periods PV factor .842 9%, 2 periods PV factor .917 9%, 1 periods At what amount should Connor present the note on the December 31, year 2 balance sheet? $82,610 $84,200 $75,100 $77,200
On January 1, year 2, Connor Corporation signed a $100,000 noninterest-bearing note due in three years at a discount rate of 10%. Connor elects to use the fair value option for reporting its financial liabilities. On December 31, year 2, Connor's credit rating and risk factors indicated that the rate of interest applicable to its borrowings was 9%. The present value factors at 10% and 9% are presented below. PV factor .751 10%, 3 periods PV factor .826 10%, 2 periods PV factor .909 10%, 1 periods PV factor .772 9%, 3 periods PV factor .842 9%, 2 periods PV factor .917 9%, 1 periods At what amount should Connor present the note on the December 31, year 2 balance sheet? $82,610 $84,200 $75,100 $77,200
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
On January 1, year 2, Connor Corporation signed a $100,000 noninterest-bearing note due in three years at a discount rate of 10%. Connor elects to use the fair value option for reporting its financial liabilities. On December 31, year 2, Connor's credit rating and risk factors indicated that the rate of interest applicable to its borrowings was 9%. The present value factors at 10% and 9% are presented below.
| PV factor | .751 | |
| 10%, 3 | ||
| periods | ||
| PV factor | .826 | |
| 10%, 2 | ||
| periods | ||
| PV factor | .909 | |
| 10%, 1 | ||
| periods | ||
| PV factor | .772 | |
| 9%, 3 | ||
| periods | ||
| PV factor | .842 | |
| 9%, 2 | ||
| periods | ||
| PV factor | .917 | |
| 9%, 1 | ||
| periods |
At what amount should Connor present the note on the December 31, year 2
$82,610
$84,200
$75,100
$77,200
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education