Exercise 5-11 (Algo) Deferred annuities [LO5-8] 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 $7,000 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.) 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 6% properly reflects the time value of money in this situation. Amount recorded

Exercise 5-11 (Algo) Deferred annuities [LO5-8] 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 $7,000 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.) 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 6% properly reflects the time value of money in this situation. Amount recorded

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 12MC: (Appendix 14.1)Pamlico Company has a 500,000, 15%, 3-year note dated January 1, 2019, payable to...

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(Appendix 14.1)Pamlico Company has a 500,000, 15%, 3-year note dated January 1, 2019, payable to Forest National Bank. On December 31, 2020, the bank agreed to settle the note and unpaid interest of 75,000 for 50,000 cash and marketable securities having a current market value of 375,000. Pamlicos acquisition cost of the securities is 385,000. Ignoring income taxes, what amount should Pamlico report as a gain from the debt restructuring on its 2020 income statement? a. 65,000 b. 75,000 c. 140,000 d. 150,000
23 On May 1, 2021, BB received a 3-year, P1,200,000 note receivable due on April 30, 2024. The note was received upon sale of an old machinery of BB which is no longer use in its operation. The interest effective of similar note is at 7%. Statement 1: The carrying value of the note as of December 31, 2022 is P1,097,039. Statement 2; The interest income for the period ending December 31, 2022 is P71,770. Group of answer choices Only statement 2 is true Both statements are true Only statement 1 is true Both statements are false
16. On 1 January 2022, Marina Tower exchanged equipment for an $800,000 zero-interest-bearing note due on January 1, 2023. The prevailing rate of interest for a note of this type at January 1, 2020 was 10%. The present value of $1 at 10% for three periods is 0.75. What amount of interest revenue should be included in Marina's 2023 income statement?Question 16Answera.$60,000b.$66,000c.$0d.$80,000. please answer do not image format
10- SK Inc, factors $400,000 of accounts receivable with Mars Finance Company on a without recourse basis on July 1,2020. The receivables records are transferred to Mars Finance, which will receive the collections. Mars Finance assesses a finance charge of 1 ½% of the amount of accounts receivable and retains an amount equal to 4% of accounts receivable to cover sales discounts, returns, and allowances. The transaction is to be recorded as a sale.Instructions:a) Prepare the journal entry on July1,2020, for SK Inc. to record the sale of receivables without recourse.b) Prepare the journal entry on July1,2020, for Mars Finance Company. to record the purchase of receivables without recou
E9-3. Non-Interest-Bearing Notes Payable LO 9.3 On November 16, 2019, Clear Glass Company borrowed $20,000 from First American Bank by issuing a 90-day, non-interest-bearing note. The bank discounted this note at 12% and remitted the difference to Clear Glass. Required: Prepare the journal entries of Clear Glass to record the preceding information, the related calendar year-end adjusting entry, and payment of the note at maturity. Show how the preceding items would be reported on the December 31, 2019, balance sheet.
JFK Corp. factors $300,000 of accounts receivable with LBJ Finance Corporation on a without recourse basis on July 1, 2020. The receivables records are transferred to LBJ Finance, which will receive the collections. LBJ Finance assesses a finance charge of 1½% of the amount of accounts receivable and retains an amount equal to 4% of accounts receivable to cover sales discounts, returns, and allowances. The transaction is to be recorded as a sale. Instructions a. Prepare the journal entry on July 1, 2020, for JFK Corp. to record the sale of receivables without recourse. b. Prepare the journal entry on July 1, 2020, for LBJ Finance Corporation to record the purchase of receivables without recourse.
Problem 9-13 Hull Company is indebted to Apex Company under a P5,000,000, 12%, three-year note dated December 21,2018. Because of financial difficulties developing in 2020. Hull Company owed accrued interest of P600,000 on the note on December 31, 2020. Under a debt restructuring on December 31, 2020, Apex Company agreed to settle the note and accrued interest for a tract of land having a fair value of P4,500,000. The acquisition cost of the lqnd is P3,600,000. 1. What amount of pretax gain on extinguishment shoul Hull Company report as component of income from continuing operations in 2020? A. 2,000,000 B. 1,400,000 C. 1,100,000 D. 900,000
3. Gliezel company has an overdue 8% note payable to City Bank at P4,000,000 and recorded accrued interest of P320,000. As a result of a settlement on January 1, 2018, City Bank agreed to the following restructuring arrangement: a. reduced the principal obligation to P3,500,000; b. forgave the P320,000 accrued interest; c. extended the maturity date to December 31, 2019 and d. annual interest of 10% is to be paid on December 31, 2018 and 2019. The present value of 1 at 8% for two periods is 0.8573, and the present value of an ordinary annuity of 1 at 8% for two periods is 1.7833. What amount of gain on extinguishment of debt to be recognized in 2018?
40 On January 1, 2022, AA Company sold an equipment costing P5,000,000 and accumulated depreciation of P1,500,000. AA received a P1,000,000 cash and a 10%, 5-year, P7,000,000 note receivable every December 31 in equal annual installment of P1,000,000 plus interest starting December 31, 2022. Interest effective on this note when received is at 8%. How much of the note receivable is reported as current as of December 31, 2022?
E9-2. Notes Payable LO 9.3 On December 1, 2019, Insto Photo Company purchased merchandise, invoice price $25,000, and issued a 12%, 120-day note to Ringo Chemicals Company. Insto uses the calendar year as its fiscal year and uses the perpetual inventory system. Required: Prepare journal entries on Insto’s books to record the preceding information, including the adjusting entry at the end of the year and payment of the note at maturity.
5. AVZ Company requires refundable advance payments with special orders for machinery constructed to the customer’s specifications. Information for 2023 is as follows: Customer advances-balance, December 31,2022 P 885,00 Advances received with orders in 2023 1,380,00 Advances applied with orders shipped in 2023 1,230,00 Advances applicable to orders canceled in 2023 375,000 What amount should AVZ Company report as a current liability for customer’s deposits in its December 31, 2023 balance sheet if AVZ’s policy is to return the deposit if the customer notifies AVZ about the cancellation?
PLEASE ANSWER ASAP Problem No. 4 AACA Corporation is a company engaged in buying and selling manufacturing equipment. On Jan. 1, 2020, AACA Corporation sold equipment, with a cash price of P1,500,000. The cost of the equipment is P750,000. The buyer signed a deferred payment contract that provides for a down payment of P300,000 and a 5-year note for P1,705,900. The note is to be paid in 5 equal annual payments of P341,180. The payments include interest and are made on Dec. 31 of each year, beginning on Dec. 31, 2020. AACA Corporation made the following entries in relation to the sale of the equipment and the related note receivable: Jan. 1, 2020 Cash 300,000 Notes receivable 1,705,900 Cost of goods sold 750,000 Sales 2,005,900 Inventory 750,000 Dec. 31, 2020 Cash 341,180 Notes receivable 341,180 Dec. 31, 2021 Cash 341,180 Notes receivable 341,180 AACA Corporation…