Question

On December 31, 2020, Riverbed Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Riverbed Co. agreed to accept a $264.100 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 11%. Riverbed is much more creditworthy and has various lines of credit at 6%. Prepare the journal entry to record the transaction of December 31, 2020. for the Riverbed Co. (Round present value factor calculations to 5 decimal places.eg. 125124 and final answers to decimal places, eg 5,275. If no entry is required, select "No Entry"for the account titles and enter for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Dec 31, 2020 e Textbook and Media List of Accounts Assuming Riverbed Co's fiscal year-end is December 31, prepare the journal entry for December 31, 2021. (Round answers to decimal places, eg 5,275. If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Dec 31, 2021 eTextbook and Media List of Accounts Assuming Riverbed Co's fiscal year-end is December 31, prepare the journal entry for December 31, 2022. (If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Dec 31, 2022 (To record interest revenue) (To record collection of note) e Textbook and Media List of Accounts

Answer 1

a) Notes Receivable 2, 64, 100 bewunt on Notes Receivable 49751 seeirce Revenue 2143 44 * Computation of present value of note Prof 2, 64, 100 due in 2 years at 11% $ 2,64,100x 0.81162 b) Doscount on notes Receivable Interest Revenue 23578 23578 * basizga. 214349 X11% = 23578. Discount on Notes Receivable 26173 Intecent Revenue - 26173 [ 49751 - 23578] com) (214349 + 23576 J x 11%) Cash. 264100 Notes Receivable 264100