Peachtree Company borrows $23,000 from the local bank at 5% interest. Theterm of the note is 5 years, and the annual payments remain constant at$5,312. Determine the decrease in notes payable that Peachtree Companyshould record in the first year.a. $1,062b. $1,150c. $4,162d. $5,312

Under installment note financing, the amount is borrowed with the promise to repay at predetermined…

Answered: Peachtree Company borrows $23,000 from…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concord Inc. received a five-year bank loan bearing interest at 7% with principal and interest instalment payments due annually. The following instalment payment schedule is partially completed: (a) Fill in the missing amounts. (Round answers to O decimal places, e.g 2,345.) Cash Payment $17,171 EA Interest Expense 4,071 2,173 1,129* Reduction of Principal $12,243 14,017 16,042 Principal Balance $70,400 58,157 45,057 16,042
TORR, Inc. issues a $600,000, 9%, five-year note payable on January 1, 20X1. If the monthly payment is $12,455, what is the note's carrying value after the first month's payment is made on January 31, 20X1? Select one: a. $600,000 b. $592,045 c. $593,540 d. $595,500 e. $587,545
Lime Co. incurs a $4,000 note with equal principal installment payments due for the next eight years. What is the amount of the current portion of the noncurrent note payable due in the second year? A. $800 B. $1,000 C. nothing, since this is a noncurrent note payment D. $500
Rosewood Company made a loan of $11,600 to one of the company's employees on April 1, Year 1. The one-year note carried a 6% rate of interest. What is the amount of interest revenue that Rosewood would report in Year 1 and Year 2, respectively? Multiple Choice $696 in Year 1 and $0 in Year 2 $0 in Year 1 and $696 in Year 2 О $174 in Year 1 and $522 in Year 2
Assuming a 360-day year, proceeds of $46,510 were received from discounting a $47,941, 90-day note at a bank. The discount rate used by the bank in computing the proceeds was a.13.18% b.13.69% c.9.94% d.11.94%
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TORR, Inc. issues a $300,000, 6%, five-year note payable on January 1, 20X1. If the monthly payment is $5,800, what is the note's carrying value after the first month's payment is made on January 31, 20X1? Select one: a. $294,200 b. $300,000 c. $298,500 d. $295,700 e. $298,214
On April 1, Year 1, Halo Co. issued a $5,000 face value discount note to the Capri Bank. The note had a 12 percent discount rate and a one-year term. 8. The amount of cash Halo received on April 1, Year 1, was a. $5,000. b. $4,250. c. $4,400. d. $5,500. 9. The total carrying value of Halo’s liabilities on December 31, Year 1, would be a. $5,600. b. $5,000. c. $5,450. d. $4,850. 10. If Halo Co. earned $2,000 of revenue in Year 1, the amount of net income would be a. $2,000. b. $1,550. c. $1,400. d. $1,850.
Halep Inc. borrowed $36,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $9,917.64 at the end of each year. Prepare an amortization table showing the principal and interest in each payment. Round your answers to two decimal places. Year BeginningBalance Payment Interest To Principal EndingBalance 1 $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 $fill in the blank 4 $fill in the blank 5 2 fill in the blank 6 fill in the blank 7 fill in the blank 8 fill in the blank 9 fill in the blank 10 3 fill in the blank 11 fill in the blank 12 fill in the blank 13 fill in the blank 14 fill in the blank 15 4 fill in the blank 16 fill in the blank 17 fill in the blank 18 fill in the blank 19 fill in the blank 20
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Peachtree Company borrows $23,000 from the local bank at 5% interest. The term of the note is 5 years, and the annual payments remain constant at $5,312. Determine the decrease in notes payable that Peachtree Company should record in the first year. a. $1,062 b. $1,150 c. $4,162 d. $5,312