Recording Entries for Long-Term Note Receivable: Effective Interest Method On January 1 of Year 1. Jacobs Company sells land in return for a $88.000 note, issued by Andress Company. The note is a $88.000, 8%, annual interest-bearing note. Andress agrees to repay the $88.000 proceeds on December 31 of Year 2. The prevailing interest rate on similar notes is 11%. Assume that the cost of the land is equal to the fair value of the note. Required • Note: Round answers to the nearest whole dollar. a. Prepare entries for Jacobs on (1) January 1 of Year 1 for the sale of land and (2) December 31 of Year 1 for interest received on the note. Use the effective interest method to amortize the discount. Date Jan. 1, Year 1 Note Receivable Account Name Dr. Cr. Discount on Note Receivable Land To record sale of the land. Dec. 31, Year 1 Cash Dec. 31, Year 2 Discount on Note Receivable Interest Revenue To record interest on note Check To record interest on note V To record settlement of note V V V V b. Prepare entries on December 31 of Year 2 to record (1) interest received on the note and (2) the settlement of the note. Date Account Name Dr. Cr. Dec. 31, Year 2 V V V 88,000 0 0 V 7,040 0 0 7,040 0 0 0✔ 61,481 x 26,519 x 0 0 0✔ 0x 2,917 * ox 0x 0x 0x 0x

Q: alternate answer?

A: Yield to Maturity (YTM):Yield to Maturity (YTM) is the total return anticipated on a bond if it is…

Q: Horizontal analysis is often referred to as the simplest approach of analyzing information. True…

A: Horozontal analysis also known as trend analysis is used to analyse and compare the data present in…

Q: Which of the following orders allows for partial execution?

A: FOK (Fill or Kill Order): This type of order allows being executed immediately at the specified…

Q: incorfrect please redo with a accurate answer

A: Molding FabricationMachine Hours $      2,500.00 $      1,500.00Fixed Manufacturing Overhead cost  $…

Q: The answer provided is not correct, please provide the correct value

A: Free Cash Flow Free Cash flow which can be determined by using the amount of net operating cash flow…

Q: Req C is incorrect.

A: Equivalent unit of production is multiplied by cost per equivalent unit to compute the assignment of…

Q: What does the blank section post mean or what goes there

A: Post Column : It is the Column through which book keeper identify whether journal entries are…

Q: Explain put–call parity relationship

A: Put-Call parity is the concept that defines the relationship between price of European call option…

Q: True or false: IFRS is based on the same characteristics of information as AspE

A: IFRS:It stands for International Financial Reporting Standards, a set of accounting standards…

Q: 7. The ultimate control of the corporation rests with the board of directors.

A: Introduction:- Board of directors:- Board of directors play vital role in every organization for…

Q: B. Working trial ba C. Control accoun

A: The correct answer is  a. Lead schedule

Q: State the meaning of incomplete records?

A: Accounting refers to the process through which the financial transactions related to a business are…

Q: The anwswer is not correct

A: Here, Annual deposits = $1,400 Annual interest rate = 5% Total years to annual deposits = 10 years…

Q: How can forwardrates be used for hedging purposes?

A: SOLUTION:- Risk management is the main stimulus for forward contracts. Forward contract is a…

Q: it is still incorrect, please find correct answer

A: Accounts receivable is amount that is yet to be recovered from the customers to whom goods or…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.