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Stels [109]
3 years ago
8

On January 1, 2020, HD Corp. paid $60,000 and issued a 5-year noninterest bearing note payable with a face value of $120,000 in

exchange for a piece of equipment. The applicable interest rate is 8%. HD Corp depreciates over a straight-line basis and utilizes the effective interest method to record interest expense. The equipment is expected to be in service for 8-years at which point it will be worthless.
Required:
What is the carrying value of the note payable on 12/31/2021?

a. $120,000
b. $88,204
c. $75.136
d. $95.260
e. $89,335
Business
1 answer:
AVprozaik [17]3 years ago
6 0

Answer:

b. $88,204

Explanation:

The computation of the carrying value of the note payable is shown below:

= Present value of the notes + interest

= $120,000 × 0.680583 + ($120,000 × 0.680583 × 8%)

= $81,670 + $6,534

= $88,204

hence, the second option is correct

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Answer:

Brief summary of the case:

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If Company had decided to manufacture all the components in Country U, then it would have been more expensive. Company A cannot sell that at an affordable price. Increase in the cost of the components would increase the overall cost of the Electronic reader K. The most important strategy of Company A is to minimize the cost of the product to increase the number of sales.

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3 0
3 years ago
A posthypnotic suggestion is made ________ a hypnosis session and intended to be carried out in the future when the subject is _
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Answer:

Net income:                             $

Revenue                             140,000

Expenses                            (50,000)

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