Installment note Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments. Effective interest rate of amortization bond Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate. To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

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Answer 1

Question

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

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I need the correct answer to this financial accounting problem using the standard accounting approach.

During 2010, Vaughn Corporation sold merchandise costing $1,500,000 on an installment basis for $2,000,000. The cash receipts related to these sales were collected as follows: 2010, $800,000; 2011, $700,000; 2012, $500,000. What is the rate of gross profit on the installment sales made by Vaughn Corporation during 2010?

Financial accounting

Answer 2

Question

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 3

Question

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

Expert Solution & Answer

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Answer 4

Question

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

Expert Solution & Answer

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Answer 5

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

Answer 6

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

Answer 7

Chapter 14, Problem 14.21E

(1)

To determine

Installment note

Installment note is an obligation in which the defaulter needs to repay the investor total amount includes principal and interest on certain terms and conditions in a series of periodic payments.

Effective interest rate of amortization bond

Effective interest rate method of amortization is a process of amortizing premium on bond or discount on bond, which allocates the different amount of interest expense in each period of interest payment, but at a constant percentage rate.

To Prepare: The journal entry to record the purchase of the components on November 1, 2016.

Answer 8

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

Answer 9

(2)

To determine

To prepare: The journal entry for the first installment payment on November 30, 2016.

Answer 10

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

Answer 11

(3)

To determine

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 14 - How is periodic interest determined for...Ch. 14 - As a general rule, how should long-term...Ch. 14 - How are bonds and notes the same? How do they...Ch. 14 - What information is contained in a bond indenture?...Ch. 14 - Prob. 14.5Q Ch. 14 - How is the price determined for a bond (or bond...Ch. 14 - A zero-coupon bond pays no interest. Explain.Ch. 14 - Prob. 14.8Q Ch. 14 - Compare the two commonly used methods of...Ch. 14 - Prob. 14.10Q

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To prepare: The journal entry for the first installment payment on November 30, 2016.

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.

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Chapter 14 Solutions

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To prepare: The journal entry for the first installment payment on November 30, 2016.

To Identify: The interest expense amount would be reported in the in the income statement as on 31st December 2016.

Want to see the full answer?

Chapter 14 Solutions

To Identify: The interest expense amount would be reported in the in the income statement as on 31^st December 2016.