6. On December 31, 2010, Chelsea Co. provides a service for its customer Villas Boas Co. in
exchange for a promissory note requiring five annual payments of $1,000 each. The payments
are to occur on December 31 of each year beginning on December 31, 2011. The note does not
specify any interest, and there is no market for the note. Based on the credit worthiness of Villas
Boas Co. and the length of the note, it is estimated that Villas Boas Co. would have to pay 10%
interest if it borrowed a similar amount from a bank. The amount of interest revenue recognized
by Chelsea for the year ended December 31, 2013 is:
a. $174
b. $249
c. $317
d. $347
Find answers to questions asked by students like you.
Q: On December 31, 2010, Chelsea Co. provides a service for its customer Villas Boas Co. inexchange for…
A: First step is to compute the amount of liability of Note payable to be recorded o Dec31, 2010.This…
Q: 18. On December 31, 2010, Chelsea Co. provides a service for its customer Villas Boas Co. inexchange…
A: First step is to compute the Amount of note receivable to be recorded on 31.12.10 through present…
Q: Tri State Bank was the payee of a $60,000 note dated August 16. The note was made for 120 days and…
A: Since, note is a discount note( not interest bearing), the value of loan = discounted present Value…
Q: Shown below are selected transactions of Gulf Corp. during the month of December 2011. Dec. 1…
A: Adjusting Entries:- Adjusting entries are referred as those entries, which occurred at the end of…
Q: Shown below are selected transactions of Gulf Corp. during the month of December 2011. Dec. 1…
A: General journal entries Date Particulars Dr.$ Cr.$ 1…
Q: Shown below are selected transactions of Gulf Corp. during the month of December 2011. Dec. 1…
A: 1. General journal:
Q: Shown below are selected transactions of Gulf Corp. during the month of December 2011. Dec. 1…
A: Adjusted balance in the Unrealized Holding Gain (or Loss) on Investments account at December : In…
Q: On 1 January, Laja Bhd owes the Arbor Bank Bhd RM350,000 which is due on December 31. Since Laja…
A: Notes payable is the liability on the company now it depends upon the time regarding to determine…
Q: On May 20, 2021, Gordon Company discounted with recourse a P75,000, 90-day, 8% note that was…
A: Maturity value of the note = Face value of note + interest = P75,000 + (P75,000*8%*90/360) = P75,000…
Q: On May 20, 2021, Gordon Company discounted with recourse a P75,000, 90-day, 8% note that was…
A: Maturity value of the note = Face value of note + interest = P75,000 + (P75,000*8%*90/360) = P75,000…
Q: A company sold goods to a customer in exchange for a 5-year, zero-interest-bearing note on January…
A: Given: Face value of the note=$244000Present value factor for 10% and 5 years =0.62 Zero -interest…
Q: On December 31, 2021, LOL Company is experiencing extreme financial pressure and is in default in…
A: Debt restructuring is a process of modification in the terms of a loan obtained by a debtor from the…
Q: On May 17, Bruno Olive Co. accepted a $6,500, 8%, 90-day note from a customer. On June 11, the note…
A: A note is a contract in written form in which one party promise to pay a certain sum of money to…
Q: Cheyenne Corp. has the following transactions related to notes receivable during the last 2 months…
A: Note receivable: Note receivable refers to a written promise received by the creditor from the…
Q: On May 1, 2014, Nico Company sold merchandise to Customer Francis and received a P26,400 (face…
A: Present value of note receivable on May 1, 2014 = Face value of note x present value factor (10%, 1…
Q: 33. On August 1, 2011, Hampton Construction received a 9 percent, six-month note receivable from…
A: Answer: Assuming that Dusty Roads pays the note plus accrued interest in full. Entry for Collection…
Q: On April 1, 2014, Somers Company assigns $200,000 of its accounts receivable to Third National Bank…
A: Working note: Computation of finance charges: Finance charges=Accounts receivable assigned×Rate of…
Q: On December 1, 2017, Marin, Inc. assigns $ 3,380,000 of its accounts receivable to Sweet Acacia Bank…
A: Adjusting journal entry: At year-end when the company finalizes its accounts then any unrecognized…
Q: On December 1, 2017, Marin, Inc. assigns $ 3,380,000 of its accounts receivable to Sweet Acacia Bank…
A: It will deduct by bank in payment of notes.
Q: The Field Detergent Company sold merchandise to the Abel Company on June 30, 2016. Payment was made…
A: Present value of note receivable is calculated by discounting the future value of note receivable at…
Q: On December 31, 2020, the Reliable Finance Company had P5,000,000 notes receivable from Burgundy…
A: Working Notes: Computation of present value of restructured notes receivable. 400000 * 0.83 =…
Q: Marydale Products permits its customers to defer payment by giving personal notes instead of cash.…
A: Journal is a place where accounting transactions are listed in the book keeping system before ledger…
Q: On May 2, Splish Company lends $8,900 to Chang, Inc., issuing a 6-month, 10% note. At the November…
A: Interest revenue = Amount of Notes receivable x rate of interest x no. of months/12 = 8900*10%*6/12…
Q: Swifty owes $ 3.6 million that is due on February 28. The company borrows $ 3000000 on February 25…
A: Since the $3.6 million note is repayable within 12 months from December 31 on the coming February…
Q: DE LA CRUZ Company received a 10%,180 day note from its customer on April 1, 2021. The note has a…
A: Solution : Given Face value =P500,000 interest rate =10% discount rate = 12 % date…
Q: On july 1, 2017 LA company sold equipment to NA company for 1,000,000. LA accepted a 10% note…
A: Discounting a note receivable refers to the selling of the notes receivable in the future for a…
Q: On December 1, 2016, Old Car Co. borrowed money at the bank by signing a 90-day non-interest-bearing…
A: Working note:
Q: On January 1, 2021, Joy Company sold used equipment and received a non-interest bearing note…
A: Part 1) Journal Entry Date Particulars Amt(Dr) Amt(Cr) 01-01-2021 Customer A/c Dr 1652893…
Q: Marydale Products permits its customers to defer payment by giving personal notes instead of cash.…
A: Notes Receivable: The note receivables are a type of promissory note which is made for the payment…
Q: Novak Supply Co. has the following transactions related to notes receivable during the last 2 months…
A: The maturity period for different notes is computed by adding the period to the issue dates for…
Q: Novak Supply Co. has the following transactions related to notes receivable during the last 2 months…
A: The maturity period for different notes is computed by adding the period to the issue dates for…
Q: On December 1, 2020 LOVELY Company assigned on a non-notification basis accounts receivable of…
A: Here interest is charged on loan balance not on note payable
Q: Brickman Corporation uses the allowance method to account for uncollectible receivables. At the…
A: Allowance method:It is a method for accounting bad debt expense, where uncollectible accounts…
Q: Whispering Supply Co. has the following transactions related to notes receivable during the last 2…
A: .Journal entries are recorded to record financial transactions in the books of accounts. These…
Q: On April 1, 2017, Indigo Company assigns $549,400 of its accounts receivable to the Third National…
A: Account receivable:The amount of money to be received by a company for the sale of goods and…
Q: On October 1, 2020, Ayayai, Inc. assigns $1,263,100 of its accounts receivable to Pina National Bank…
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…
Q: Assume that on 15th January 2019 Mustafa and Sons LLC sold OMR 15000 goods to Ibri traders on…
A: The maturity value is the amount to be paid at the time of maturity of note note receivable by the…
Q: amantha, Inc. grants its customers 30-day credit. The company uses the allowance method for its…
A: >Bad Debt Expense is recorded using two methods: #1: Direct write off method: Expense is…
Q: Brickman Corporation uses the allowance method to account for uncollectible receivables. At the…
A: Year-end balance in Allowance for Bad Debts = Beginning balance in Allowance for Bad Debts - Amount…
Q: On March 1, 2018, Bodie Co. accepted a $7,900 face value note as evidence of a loan it made to T…
A: Solution: Time period in 2018 = March 1 to Dec 31 = 10 months Face value of note = $7,900 Interest…
Q: X Corporation accepted a P400,000 face value, six-month, 10% note dated May 15 from a customer. On…
A: Simple interest = Principal ×Interest rate × Time =P400,000 × 10% × 612=P20,000 Maturity value =…
Q: On December 1, 2020, Company assigned specific accounts receivable totalling P4,000,000 as…
A: The balance due to the company for goods and services provided but not yet charged by customers is…
Q: On December 1, 2020, Company assigned specific accounts receivable totalling P4,000,000 as…
A: given that, The company assigned specific accounts receivable totaling P4,000,000 as collateral on a…
Q: On December 1, 2020, Company assigned specific accounts receivable totalling P4,000,000 as…
A: Accounts receivable refers to the amount of goods and services rendered on credit but not payment…
Q: S9-10 Accounting for a note receivable On June 6, Lakeland Bank & Trust lent $80,000 to Stephan Stow…
A: A note receivable is the amount that the issuer of the note will receive at a future date as…
Q: On December 31, 2020, Whispering Co. performed environmental consulting services for Hayduke Co.…
A: Present value of note = Amount of zero-interest-bearing note x PVIF (11%, 2 years) = $318,100 x…
Q: Assuming loan made by M Enterprises to Banco De Oro amounting to P350,000.00 payable in three years…
A: A personal loan is the borrowed amount of money used to cover number of personal expenses. Personal…
Q: Anama Company is a dealer of equipment. On January 1, 2021, the entity sold equipment in exchange…
A: As per amortized cost method, the financial instrument is recognized at present value and increases…
Q: Keesha Co. borrows $200,000 cash on November 1, 2018, by signing a 90-day, 9% note with a face value…
A: Since we are entitled to answer up to 3 sub-parts, we’ll answer the first 3 schedules. Please…
Q: 8. On January 1, 2020, Susana Lopez signed a note to buy a used car. Her semi-annual payments of…
A: pleas see the next step for solution