why is it worked out 1/1.1 and answer divided by 1.1 to get 0.826446? Can you explain it to me step by step please. It is PV at 10% for end of year 2. I am having trouble understanding the process. Can you please explain it to me?
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On December 31, 2020, Ed Abbey Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Abbey Co. agreed to accept a $200,000 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 10%. Abbey is much more creditworthy and has various lines of credit at 6%.
For step 1, why is it worked out 1/1.1 and answer divided by 1.1 to get 0.826446? Can you explain it to me step by step please. It is PV at 10% for end of year 2. I am having trouble understanding the process. Can you please explain it to me?
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- Marmol Corporation uses the allowance method for bad debts. During 2019, Marmol charged 50,000 to bad debt expense and wrote off 45,200 of uncollectible accounts receivable. These transactions resulted in a decrease in working capital of: a. 0 b. 4,800 c. 45,200 d. 50,000Dortmund Stockyard reports $896,000 in credit sales for 2018 and $802,670 in 2019. It has a $675,000 accounts receivable balance at the end of 2018, and $682,000 at the end of 2019. Dortmund uses the balance sheet method to record bad debt estimation at 8% during 2018. To manage earnings more favorably, Dortmund changes bad debt estimation to the income statement method at 6% during 2019. A. Determine the bad debt estimation for 2018. B. Determine the bad debt estimation for 2019. C. Describe a benefit to Dortmund Stockyard in 2019 as a result of its earnings management.On December 31, 2020, Larkspur Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Larkspur Co. agreed to accept a $ 252,100 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 10%. Larkspur is much more creditworthy and has various lines of credit at 6%.Click here to view factor table.
- On December 31, 2020, Whispering Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Whispering Co. agreed to accept a $318,100 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%. Whispering is much more creditworthy and has various lines of credit at 5%. (a) Prepare the journal entry to record the transaction of December 31, 2020, for the Whispering Co. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)On December 31, 2020, Whispering Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Whispering Co. agreed to accept a $318,100 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%. Whispering is much more creditworthy and has various lines of credit at 5%. Prepare the journal entry to record the transaction of December 31, 2020, for the Whispering Co. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020 Notes Receiveables 318100 Discount on Notes Receiveable 59924…On December 31, 2020, Ed Abbey Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Abbey Co. agreed to accept a $200,000 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 10%. Abbey is much more creditworthy and has various lines of credit at 6%. Instructions a. Prepare the journal entry to record the transaction of December 31, 2020, for the Ed Abbey Co. b. Assuming Ed Abbey Co.’s fiscal year-end is December 31, prepare the journal entry for December 31, 2021. c. Assuming Ed Abbey Co.’s fiscal year-end is December 31, prepare the journal entry for December 31, 2022. *Explained step by step please.
- On December 31, 2020, Ed Abbey Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Abbey Co. agreed to accept a $200,000 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 10%. Abbey is much more creditworthy and has various lines of credit at 6%. Instructions a. Prepare the journal entry to record the transaction of December 31, 2020, for the Ed Abbey Co. b. Assuming Ed Abbey Co.’s fiscal year-end is December 31, prepare the journal entry for December 31, 2021. c. Assuming Ed Abbey Co.’s fiscal year-end is December 31, prepare the journal entry for December 31, 2022.By December 31, 2017, Culver Corporation had performed a significant amount of environmental consulting services for Sunland Company. Sunland Company was short of cash, and Culver Corporation agreed to accept a $182,000, non–interest-bearing note due December 31, 2019, as payment in full. Sunland Company is a bit of a credit risk and typically borrows funds at a rate of 12%. Culver Corporation is much more creditworthy and has various lines of credit at 8%. Culver Corporation reports under IFRS. The tables in this problem are to be used as a reference for this problem. Prepare the journal entry to record the transaction on December 31, 2017, for Culver Corporation. Assuming Culver Corporation’s fiscal year end is December 31, prepare the journal entry required at December 31, 2018. Assuming Culver Corporation’s fiscal year end is December 31, prepare the journal entry required at December 31, 2019. What are the amount and classification of the note on Culver Corporation’s statement of…By December 31, 2017, Culver Corporation had performed a significant amount of environmental consulting services for Sunland Company. Sunland Company was short of cash, and Culver Corporation agreed to accept a $182,000, non–interest-bearing note due December 31, 2019, as payment in full. Sunland Company is a bit of a credit risk and typically borrows funds at a rate of 12%. Culver Corporation is much more creditworthy and has various lines of credit at 8%. Culver Corporation reports under IFRS. The tables in this problem are to be used as a reference for this problem. Prepare the journal entry to record the transaction on December 31, 2017, for Culver Corporation. Assuming Culver Corporation’s fiscal year end is December 31, prepare the journal entry required at December 31, 2018.