Hermes Inc. received on January 1, 2017, a $22,800 4-year zero-interest bearing note for lending $16,400...
Hermes Inc. received on January 1, 2017, a $22,800 4-year zero-interest bearing note for lending $16,400 to Phoenix Co. Hermes financial year ends December 31. Round to the nearest whole number. The discount rate on the note is
Homework Answers
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Discount rate on the note = (22,800-16,400)^1/4 - 1 = 6400^1/4 - 1 = 9% (rounded) |
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Hermes Inc. received on January 1, 2017, a $22,800 4-year
zero-interest bearing note for lending $16,400...
Concord Corporation issued a 5-year, $82,000, zero-interest-bearing note to Brown Company on January 1, 2020, and...
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On January 1, 20x6, Cell Co. lends some money in exchange for a 10% $100,000 10-year...
On January 1, 20x6, Cell Co. lends some money in exchange for a 10% $100,000 10-year note. The market rate for similar notes is 8%. Interest is received semiannually each July 1 and January 1. The financial year ends December 31. Round to the nearest whole number. (Hint: Prepare a partial amortization schedule to July 1, 20x8) a. The note is issued at -----(par / premium / discount) b. The present value of the note is c The cash received...
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On January 1, 2017, Marin Inc. borrowed and received $260,000 from a major customer, Bramble Corp. The debt is evidenced by a zero-interest-bearing note due in 4 years. Marin, as consideration for the zero-interest-bearing feature of the note, agrees that it will supply inventory to Bramble for the loan period at a below-market price. The appropriate rate at which to impute interest is 8%. a) Prepare the journal entry to record the initial transaction on January 1, 2017. b) Prepare...
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Oriole Incorporated issued a $106,000, 5-year, zero-interest-bearing note to Cheyenne Corp. on January 1, 2020, and...
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