On May 1, 2021, Slack Holdings Inc. loaned Summit Corp. $850,000 on a 6% note, payable in five annual installments of $250,000 (plus interest), beginning January 2, 2022. Interest on the note is payable on the first day of each month, beginning June 1, 2021. Summit Corp. made timely payments through November 1, 2021. On January 2, 2022, Slack Holdings Inc. received payment of the first principal installment plus all interest due. At December 31, 2021, Slack Holdings Inc.'s interest receivable on this loan is:

On May 1, 2021, Slack Holdings Inc. loaned Summit Corp. $850,000 on a 6% note, payable in five annual installments of $250,000 (plus interest), beginning January 2, 2022. Interest on the note is payable on the first day of each month, beginning June 1, 2021. Summit Corp. made timely payments through November 1, 2021. On January 2, 2022, Slack Holdings Inc. received payment of the first principal installment plus all interest due. At December 31, 2021, Slack Holdings Inc.'s interest receivable on this loan is:

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

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 28E: On January 1, 2019, Northfield Corporation becomes delinquent on a 100,000, 14% note to First...

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On January 1, 2019, Northfield Corporation becomes delinquent on a 100,000, 14% note to First National Bank, on which 16,651 of interest has accrued. On January 2, 2019, the bank agrees to restructure the note. It forgives the accrued interest, extends the repayment date to December 31, 2021, and reduces the interest rate to 10%. Required: Prepare a schedule for Northfield to compute the annual interest expense in regard to the preceding note for each year of the restructuring agreement.
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, 2019, Aldrich Company purchased as an available-for-sale security 200,000 face value, 9% U.S. Treasury notes for 194,000. The notes mature July 1, 2020, and pay interest semiannually on January 1 and July 1. The notes were sold on December 1, 2019, for 199,000. Aldrich normally uses straight-line amortization on all of its notes. In its income statement for the year ended December 31, 2019, what amount should Aldrich report as a gain on the sale of the available-for-sale security? a. 2,500 b. 3,500 c. 5,000 d. 6,000
Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?
Spath Company borrows 75,000 by issuing a 4-year, noninterest-bearing note to a customer on January 1, 2019. In addition, Spath agrees to sell inventory to the customer at reduced prices over a 5-year period. Spaths incremental borrowing rate is 12%. The customer agrees to purchase an equal amount of inventory each year over the 5-year period so that a straight-line method of revenue recognition is appropriate. Required: Prepare the journal entries on Spaths books for 2019 and 2020. (Round answers to 2 decimal places.)
On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10% interest rate. Each annual payment is in the amount of $39,569 and payment is due each Dec. 31. What is the journal entry on Jan. 1 to record the cash received and on Dec. 31 to record the annual payment? (You will need to prepare the first row in the amortization table to determine the amounts.)
On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.
On January 1, 2019, Boater Company issues a 20,000 non-interest-bearing, 5-year note for equipment. Neither the fair value of the note nor the equipment is determinable. Boaters incremental borrowing rate is 9%. The asset has a useful life of 7 years. Prepare the journal entry for Boater to record the issuance of the note on January 1.
On June 1, 2020, Waterway Industries loaned Carla Vista $504000 on a 11% note, payable in five annual installments of $100800 beginning January 2, 2021. In connection with this loan, Carla Vista was required to deposit $5040 in a zero-interest-bearing escrow account. The amount held in escrow is to be returned to Carla Vista after all principal and interest payments have been made. Interest on the note is payable on the first day of each month beginning July 1, 2020. Carla Vista made timely payments through November 1, 2020. On January 2, 2021, Waterway received payment of the first principal installment plus all interest due. At December 31, 2020, Waterway's interest receivable on the loan to Carla Vista should be O $0. O $14280. O $9240. O $5040.
On September 1, 2020, Bramble Corp. issued a note payable to Fidelity Bank in the amount of $2736000, bearing interest at 12%, and payable in three equal annual principal payments of $912000. On this date, the bank's prime rate was 13%. The first payment for interest and principal was made on September 1, 2021. At December 31, 2021, Bramble should record accrued interest payable of $118560. $72960. $237120. $109440.
On September 1,2020, Sunland Company issued a note payable to Fidelity Bank in the amount of $2691000, bearing interest at 9%, and payable in three equal annual principal payments of $897000. On this date, the bank's prime rate was 10%. The first payment for interest and principal was made on September 1, 2021. At December 31, 2021, Sunland should record accrued interest payable of O $89700. O $80730. O $179400, O $53820.
On January 1, 2021, Glanville Company sold goods to Otter Corporation. Otter signed an installment note requiring payment of $21,500 annually for five years. The first payment was made on January 1, 2021. The prevailing rate of interest for this type of note at date of issuance was 10%. Glanville should record sales revenue in January 2021 of: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Multiple Choice $107,500 $81,502 $89,652 None of these answer choices are correct.