Question

Check my work View previous attempt Exercise 5-11 (Algo) Deferred annuities (LO5-8] points Lincoln Company purchased merchandise from Grandville Corp. on September 30, 2021. Payment was made in the form of a noninterest-bearing note requiring Lincoln to make six annual payments of $7,800 on each September 30, beginning on September 30, 2024. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided. Round your final answer to nearest whole dollar amount.) Book Required: Calculate the amount at which Lincoln should record the note payable and corresponding purchases on September 30, 2021, assuming that an interest rate of 9% properly reflects the time value of money in this situation. Hint Amount recorded Print References

Answer 1

Solution:

Amount at which lincoin should record the note payable and corresponding purchases on September 30, 2021 = $7,800 * Cumulative PV factor at 9% for 3rd to 8th period

= $7,800 * 3.77571 = $29,451