On July 1, 2023, Shamrock Inc. made two sales:1It sold excess land in exchange for a four-year, non-interest-bearing promissory note in the face amount of $1,079,350. Theland's carrying value is $540,000.2.It rendered services in exchange for an eight-year promissory note having a face value of $360,000. Interest at a rate of 3%is payable annually.The customers in the above transactions have credit ratings that require them to borrow money at 11% interest.Shamrock recently had to pay 8% interest for money it borrowed from British Bank.On July 1, 2023, Shamrock also agreed to accept an installment note from one of its customers in partial settlement ofaccounts receivable that were overdue. The note calls for four equal payments of $21,600, including the principal andinterest due, on the anniversary of the note. The implied interest rate on this note is 10%.The tables in this problem are to be used as a reference for this problem. Prepare the journal entries to record the three notes receivable transactions of Shamrock on July 1, 2023.

On July 1, 2023, Shamrock Inc. made two sales:1It sold excess land in exchange for a four-year, non-interest-bearing promissory note in the face amount of $1,079,350. Theland's carrying value is $540,000.2.It rendered services in exchange for an eight-year promissory note having a face value of $360,000. Interest at a rate of 3%is payable annually.The customers in the above transactions have credit ratings that require them to borrow money at 11% interest.Shamrock recently had to pay 8% interest for money it borrowed from British Bank.On July 1, 2023, Shamrock also agreed to accept an installment note from one of its customers in partial settlement ofaccounts receivable that were overdue. The note calls for four equal payments of $21,600, including the principal andinterest due, on the anniversary of the note. The implied interest rate on this note is 10%.The tables in this problem are to be used as a reference for this problem. Prepare the journal entries to record the three notes receivable transactions of Shamrock on July 1, 2023.

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

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 10MC: On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major...

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On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
On July 1, 2023, Shamrock Inc. made two sales:It sold excess land in exchange for a four-year, non-interest-bearing promissory note in the face amount of $1,079,350. Theland's carrying value is $540,000.2.It rendered services in exchange for an eight-year promissory note having a face value of $360,000. Interest at a rate of 3%is payable annually.The customers in the above transactions have credit ratings that require them to borrow money at 11% interest.Shamrock recently had to pay 8% interest for money it borrowed from British Bank.3.On July 1, 2023, Shamrock also agreed to accept an installment note from one of its customers in partial settlement ofaccounts receivable that were overdue. The note calls for four equal payments of $21,600, including the principal andinterest due, on the anniversary of the note. The implied interest rate on this note is 10%.The tables in this problem are to be used as a reference for this problem.
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