Credulous Company purchased equipment on January 1,2020 under the following terms:The same equipment was available at a cash price ofProblem 23-2 (ACP)uisitionsP200,000 downpaymentb.Five annual payments of P100,000, the first installmentnote to be paid on December 31, 2020.a.ordinaryP120 peralueofP580,000.cementRequired:Prepare journal entries for 2020 and 2021.00 foraluedOn January 1, 2020, Enrich Company purchased a machineunder the following terms:Problem 23-3 (ACP)e ofch itnalb. Four annual payments of P200,000, the first installmenta. P100,000 downpaymentuenote to be paid on December 31, 2020.The fair value of the machine is not clearly determinable onThe prevailing rate of interest for this type of obligation is 10%.The present value factors at 10% for four periods are:isthe date of acquisition..6833.170Present value of 1Present value of ordinary annuity of 1Required:Prepare journal entries for 2020 and 2021.

Hi! Thank you for the question, As per the honor code, we'll answer the first question since the…

Problem 23-2 (ACP) Credulous Company purchased equipment on January 1, 2020 under the following terms: P200,000 dow npayment a. b. .Five annual payments of P100,000, the first installment note to be paid on December 31, 2020. The same equipment was available at a cash price of P580,000.

Problem 23-2 (ACP) Credulous Company purchased equipment on January 1, 2020 under the following terms: P200,000 dow npayment a. b. .Five annual payments of P100,000, the first installment note to be paid on December 31, 2020. The same equipment was available at a cash price of P580,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On January 1, New York Company borrowed $180,000 to purchase machinery and agreed to pay 5% interest for 6 years on an installment note. Each note payment is due on the last day of the year. What is the total interest expense over the life of the loan? A. $32,779 B. $54,000 C. $33,657 D. $35,463
None
Recording Purchase of Equipment through Debt and Equity On January 1, Vale Inc. acquires equipment with a 10-year useful life by issuing a two-year, zero-interest bearing installment note payable. The market rate is 14% for similar transactions. Terms are $19,600 cash payment immediately plus payments of $14,000 cash at the end of each of the next two years. The company uses the effective interest method to amortize any discount on note payable and the straight-line method to record depreciation expense. Required a. Prepare the entry to record the purchase of this equipment. b. Prepare the entry at the end of year one for (1) interest accrual, (2) cash payment, and (3) depreciation expense. c. Prepare the entry at the end of year two for (1) interest accrual, (2) cash payment, and (3) depreciation expense. d. Assume instead that Vale exchanged 280 shares of its own $1 par common stock along with $19,600 cash for the equipment. The stock was not actively traded, but the equipment was…
gop.4
Journal entries a. $30,000 cash was borrowed on a five-year 10% note payable, dated 5/1/2021. b. $13,000 cash was paid for land. c. Earned $118,000 in service revenues for 2020. $53,000 on account and the remainder in cash. d. Purchased Inventory with $15,000 cash. e. Sold $12,000 of inventory for $17,000 cash. f. Issued 4,000 additional shares of $0.50 par value common stock for cash at $1 per share on 1/2/2021. g. Incurred $114,000 in miscellaneous operating expenses for 2021, $20,000 on credit and the rest paid in cash. h. Collected $34,000 owned on account. i. Purchased $17,000 supplies on account. j. Paid $26,000 accounts payable. k. A piece of equipment costing $3,000 was stolen. The insurance company reimbursed the company $1,000. The accumulated depreciation on the equipment amounted to $1,000 l. Bid on a $2,000 one-year service contract. If accepted, work is to begin on 2/1/2022. m. $103,000 was paid for employee wages. This included wages owed from 2021. n. Declared and paid…
plese.asp
Rahul
Number of Cash Flows On July 1, 2019, Boston Company purchased a machine at a cost of $80,000. It paid $56,046.06 in cash and signed a 10% note for the difference. This note is to be paid off in annual installments of $5,000 each, payable each July 1, beginning immediately. The $5,000 includes a payment of interest on the balance of the principal at the beginning of each period and a payment on the principal. Calculate the number of annual payments to be made by Boston.
unc.5
un.9
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
shj.8