Note exchanged for assets or services Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate. To Prepare: The journal entry to record the issuance of the bonds.

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Answer 1

Question

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

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Students have asked these similar questions

On January 1, 20x1, PRISM Co. acquired machinery by issuing a 3-year, P1,200,000 noninterest-bearing note payable due as follows: Date Amount of installment December 31, 20x1 600,000 December 31, 20x2 400,000 December 31, 20x3 200,000 TOTAL 1,200,000 The prevailing rate of interest for this type of note is 10%. How much is the carrying amount of the note on December 31, 20x1? Select the correct response: 867,312 1,026,296 528,926 489,762

25 A company purchases a piece of machinery by issuing a $300,000 five-year note payable. The stated and effective annual interest rates are both 6%, and monthly installment payments are $5,800. What is the balance in the Notes Payable account after two payments have been made? $288,400 O $291,379 $295,700 $300,000 NEXT > BOOKMARK

15. On January 1, 20x1, ABC sold a used vehicle with a historical cost of P2,000,0000 and accumulated depreciation of P700,000 in exchange for cash of P100,000 and a noninterest bearing note receivable of P1,000,000 due in 4 equal annual installments starting on December 31, 20x1 and every December 31, thereafter. The prevailing rate of interest for this type of note is 12%. On December 31, 20x3, the current portion of the note receivable is approximately (use 6-decimal present value factor) The correct answer is: 223,214

Answer 2

Question

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

Expert Solution & Answer

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Answer 3

Question

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

Expert Solution & Answer

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Answer 4

Question

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

Expert Solution & Answer

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Answer 5

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

Answer 6

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

Answer 7

Chapter 14, Problem 14.10P

(1)

To determine

Note exchanged for assets or services

Sometimes a note payable or note receivable is exchanged with the assets (cash or noncash) or services. But the stated rate of interest in such notes may not indicate the market rate. The value of the assets or services thus exchanged for the note establishes the market rate.

To Prepare: The journal entry to record the issuance of the bonds.

Answer 8

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

Answer 9

(2)

To determine

To Prepare: The journal entry to record the acquisition of the office equipment.

Answer 10

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

Answer 11

(3)

To determine

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

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Answer 15

Ch. 14 - How is periodic interest determined for...Ch. 14 - As a general rule, how should long-term...Ch. 14 - How are bonds and notes the same? How do they...Ch. 14 - What information is contained in a bond indenture?...Ch. 14 - On January 1, 2018, Brandon Electronics issued 85...Ch. 14 - How is the price determined for a bond (or bond...Ch. 14 - A zero-coupon bond pays no interest. Explain.Ch. 14 - Prob. 14.8Q Ch. 14 - Compare the two commonly used methods of...Ch. 14 - Prob. 14.10Q

To Prepare: The journal entry to record the acquisition of the office equipment.

To Prepare: The journal entry to record the issuance of installment payable for purchases of building.

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Chapter 14 Solutions