Intermediate Accounting
1st Edition
ISBN: 9780132162302
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Chapter 16, Problem 16.15E
Notes Receivable. Each of the following three columns refers to an independent case. All data represent amounts as of January 1, the date on which the long-term notes receivable were issued except for the interest income, which is for the life of the note. Assume annual interest payments. Fill in the missing information identified by the letters A through I.
| Item | Case 1 | Case 2 | Case 3 |
| Notes receivable, face value | $900,000 | $1,000,000 | $2,000,000 |
| Initial carrying value | A | $901,819 | G |
| Market rate | B | 8% | H |
| Stated rate | 8% | 7% | 10% |
| Term of notes 1 in years) | 20 years | D | 5years |
| Note receivable discount | (153,244) | E | 1 |
| Interest income over the note's term | C | F | 1,200,000 |
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Required:
Complete the following table by computing the missing amounts for the following independent
cases. (Do not round intermediate calculations. Round "Annual Interest Rate" to 1 decimal
place.)
a.
b.
C.
Principal Amount
on Notes
Receivable
$
$
50,000
40,000
Annual Interest
Rate
12.0%
%
9.0 %
Time Period
6 months
9 months
12 months
Interest
Earned
$
$
3,600
2,700
Compute the due date, amount of interest and total cash received on the maturity date for the following notes receivable:
1-Date of Note: May 30; $24,000, 9%, 120 days
2-Date of Note March1; $32,500, 8%, 90 days
3-Date of Note November6; $400,000, 12%; 5months
Do not answer in image format Answer completely.
Chapter 16 Solutions
Intermediate Accounting
Ch. 16 - Prob. 16.1QCh. 16 - Is reporting an investment at its cost considered...Ch. 16 - Prob. 16.3QCh. 16 - Prob. 16.4QCh. 16 - Prob. 16.5QCh. 16 - Prob. 16.6QCh. 16 - What categories can managers use to classify...Ch. 16 - When is the equity method of accounting for...Ch. 16 - Prob. 16.9QCh. 16 - Can companies apply the fair value option to all...
Ch. 16 - What is the fair value hierarchy for investment...Ch. 16 - Prob. 16.12QCh. 16 - Prob. 16.13QCh. 16 - Prob. 16.14QCh. 16 - Prob. 16.15QCh. 16 - Prob. 16.16QCh. 16 - Prob. 16.17QCh. 16 - Deutsch Imports has three securities in its...Ch. 16 - Prob. 16.2MCCh. 16 - Prob. 16.3MCCh. 16 - Prob. 16.4MCCh. 16 - Prob. 16.5MCCh. 16 - Prob. 16.6MCCh. 16 - Prob. 16.7MCCh. 16 - Prob. 16.1BECh. 16 - Prob. 16.2BECh. 16 - Debt Investments, Trading. Using the information...Ch. 16 - Prob. 16.4BECh. 16 - Prob. 16.5BECh. 16 - Prob. 16.6BECh. 16 - Prob. 16.7BECh. 16 - Prob. 16.8BECh. 16 - Notes Receivable. Aaron Anatole accepted a...Ch. 16 - Prob. 16.10BECh. 16 - Prob. 16.11BECh. 16 - Prob. 16.12BECh. 16 - Debt Investments. Impairments. IFRS. For each debt...Ch. 16 - Prob. 16.14BECh. 16 - Prob. 16.15BECh. 16 - Prob. 16.1ECh. 16 - Prob. 16.2ECh. 16 - Prob. 16.3ECh. 16 - Prob. 16.4ECh. 16 - Prob. 16.5ECh. 16 - Prob. 16.6ECh. 16 - Debt and Equity Investments, Available-for-Sale...Ch. 16 - Prob. 16.8ECh. 16 - Prob. 16.9ECh. 16 - Prob. 16.11ECh. 16 - Equity-Investments, Equity Method. Book Value of...Ch. 16 - Prob. 16.13ECh. 16 - Prob. 16.14ECh. 16 - Notes Receivable. Each of the following three...Ch. 16 - Prob. 16.16ECh. 16 - Prob. 16.17ECh. 16 - Prob. 16.18ECh. 16 - Prob. 16.19ECh. 16 - Prob. 16.20ECh. 16 - Prob. 16.21ECh. 16 - Prob. 16.22ECh. 16 - Prob. 16.23ECh. 16 - Prob. 16.1PCh. 16 - Debt Investments, Trading. Freder Software Group...Ch. 16 - Prob. 16.3PCh. 16 - Equity Investments, Readily Determinable Fair...Ch. 16 - Prob. 16.5PCh. 16 - Prob. 16.6PCh. 16 - Prob. 16.7PCh. 16 - Prob. 16.8PCh. 16 - Prob. 16.9PCh. 16 - Equity Investments, Equity Method, Fair Value...Ch. 16 - Prob. 16.11PCh. 16 - Prob. 16.12PCh. 16 - Prob. 16.13PCh. 16 - Prob. 16.14PCh. 16 - Prob. 16.15PCh. 16 - Prob. 16.16PCh. 16 - Prob. 16.17PCh. 16 - Prob. 1JCCh. 16 - Prob. 2JCCh. 16 - Prob. 1FSACCh. 16 - Prob. 1SSCCh. 16 - Prob. 1BCCCh. 16 - Prob. 2BCC
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Which of the following accounts are used when a short-term note payable with 5% interest is honored (paid)? A. short-term notes payable, cash B. short-term notes payable, cash, interest expense C. interest expense, cash D. short-term notes payable, interest expense, interest payablearrow_forwardNotes Receivable Transactions The following notes receivable transactions occurred for Harris Company during the last three months of the current year. (Assume all notes are dated the day the transaction occurred.) Required: 1. Prepare the journal entries to record the preceding note transactions and the necessary adjusting entries on December 31. (Assume that Harris does not normally sell its notes and uses a 360-day year for the purpose of computing interest. Round all calculations to the nearest penny.) 2. Show how Harris notes receivable would be disclosed on the December 31 balance sheet. (Assume these are the only note transactions encountered by Harris during the year.)arrow_forwardplease answer do not image formatarrow_forward
- Note receivable Prefix Supply Company received a 120-day, 7% note for $84,000, dated April 12 from a customer on account. Assume 360-days in a year. a. Determine the due date of the note. b. Determine the maturity value of the note. $ c. Journalize the entry to record the receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank. Earrow_forwardNote receivable Prefix Supply Company received a 120-day, 6% note for $500,000, dated April 12 from a customer on account. Assume 360-days in a year. a. Determine the due date of the note. b. Determine the maturity value of the note. c. Journalize the entry to record the receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank. 88arrow_forwardNote Receivable Maggiano Supply Company received a 120-day, 6% note for $420,000, dated June 12, from a customer on account. Assume 360 days in a year. a. Determine the due date of the note. b. Determine the maturity value of the note.$ c. Journalize the entry to record the receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank. Cash Notes Receivable Interest Revenuearrow_forward
- the following interest bearing promissory note was discounted at a bank by the oayee before maturity. use the ordinary interest method 360 days to calculate the missing information. round dollars to the nearest cent.arrow_forwardRakoarrow_forwardCalculate the missing amount for each of the following notes receivable. Face Value Annual Interest Rate Fraction of the Year Interest $10,700 6 % 4 months $27,000 5 % months $450 $32,000 % 6 months $640 10 % 6 months $670arrow_forward
- Assuming a 360-day year, the interest charged by the bank, at the rate of 6%, on a 90-day, discounted note payable of $106,407 isarrow_forward(P5) Accounting for notes receivable Journalize the following transactions: March 1 Received a $3,000, 90 day, 18 percent promissory note in settlement of accounts receivable from Hosta Company. March 31 Discounted the note to a bank(discount rate = 19 percent).arrow_forwardda 14 (Notes Receivable and Notes Receivable Discounted) The following notes receivable transactions occurred for the Hara Company during the last three months of the current year. (Assume all notes are dated the day the transaction occurred.) Oct. 9 Received a $5,000, 12%, 60-day note from Kanda a customer. Oct. 12 Received a $6,000, 10%, 90-day note from Darun a customer. Oct. 15 Discounted the Kanda note with recourse at the bank at 14%. Nov. 11 Discounted the Darun note with recourse at the bank at 15%. Nov. 16 Received a $8,000, 12%, 60-day note from Nena a customer. Nov. 20 Received a $6,000, 11%, 120-day note from Wanna a customer. Dec. 1 Received a $9,000, 13%, 90-day note from Wirun a customer. Dec. 8 Received notice that the Kanda note was paid at maturity. Dec. 10 Discounted the Wanna note with recourse at the bank at 13%. Required 1. Prepare journal entries to record the preceding note transactions and the necessary adjusting entries on December 31. (Assume that Hara does…arrow_forward
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