Note receivable: Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business. Interest on note: Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender. Maturity date: Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest. To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

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Answer 1

Question

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

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QUESTION 1 Rentokil Limited issued a 10-year bond on January 1 2011. It pays interest on January1. The below amortization schedule and interest schedule reflects this. Its year end isDecember 31. Requirements: a) Indicate whether the bonds were issued at a premium or a discount and explainhow you came to your decision. b) Compute the stated interest rate and the effective interest rate c) Prepare the journal entries for the following years:I. 2011, 2012 & 2018.

Blueberry Corp. plans to tighten its credit policy. The new policy will decrease the average number of days in collection from 65 to 45, as well as reduce the ratio of credit sales to total revenue from 80% to 70%. The company estimates that projected sales will be 8% less if the proposed new credit policy is implemented. The firm’s short-term interest cost is 8%. Projected sales for the coming year are $32,000,000. Assuming a 360-day year, calculate the dollar impact on accounts receivable of Blueberry Corp. of this proposed change in credit policy.

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Answer 2

Question

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

Expert Solution & Answer

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Answer 3

Question

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

Expert Solution & Answer

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Answer 4

Question

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

Expert Solution & Answer

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Answer 5

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

Answer 6

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

Answer 7

Chapter 8, Problem 8.7BE

(a)

To determine

Note receivable:

Note receivable refers to a written promise for the amounts to be received within a stipulated period of time. This written promise is issued by a debtor or, a borrower to lender or, creditor. Notes receivable is an asset of a business.

Interest on note:

Interest on note is the amount charged on the principal value of note for the privilege of borrowing money. Interest is to be paid by the borrower, and to be received by the lender.

Maturity date:

Maturity date is the due date on the note receivable, on due date the borrower is supposed to repay the face value of the note, along with interest.

To determine: The missing amount of total interest, and maturity date for the note issued on April 1.

Answer 8

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

Answer 9

(b)

To determine

The missing maturity date and annual interest rate for the note issued on July 2.

Answer 10

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

Answer 11

(c)

To determine

The missing amount of total interest and maturity date for the note issued on March 7.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 8 - What is the difference between an account...Ch. 8 - What are some common types of receivables other...Ch. 8 - What are the essential features of the allowance...Ch. 8 - Prob. 4Q Ch. 8 - Prob. 5Q Ch. 8 - 6. What types of receivables does Tootsie Roll...Ch. 8 - Prob. 7Q Ch. 8 - Prob. 8Q Ch. 8 - Prob. 20Q Ch. 8 - Prob. 21Q

Solution Summary: The author calculates the amount of interest on note by multiplying the principal amount, annual interest rate, and time in terms of one year.

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The missing maturity date and annual interest rate for the note issued on July 2.

The missing amount of total interest and maturity date for the note issued on March 7.

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