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8-48 & 8-49

On May Company Required 1.2020, Swimm Company sold merchandise to Customer Lochte and received income statement and balance sheet . noninterest-bearing note. The market rate of interest is 10%. The annual repor ng ise to Customer Lochte and reccived a $26,400 (face amount), Exercioe 8-48 onint y ends on December 31. Customer Lochte paid the note in full on its maturity Reporting Transaction with Short-Term, Interest-Bearing Note Receivable LOS Prepare all entries for Swimm Company related to the above transactions, incl ents. Amortize the discount on the note receivable using the straight-line method. f method, we amortize the discount equally over the 12-months. int: Under the straight- line Sh ow what should be presented on the 2020 income statement and balance s heet. note e $40,000 proceeds on De cember 31, 2021 The prevailing interest rate on similar notes is 11%. Assume that the cost of the land is equal to the selling price. is a $40,000, 8%, annual interest bearing note. Andress agrees to repay ti nanced through a $40,000 note, issued by Andress Company. Exercise 8-49 ries or Long-Term Note Reeta ost Effective-Interest Amortization LO5 Required Phepare all entries for Jacobs over the note term, including any year-end adjustments. Use the effective-interest method to amortize the discount. On July 1, 2020, Stealth Company sold a machine that had a list price of $36,000. The customer paid customer paid $6,000 Annual interest on the full Exercise 8-50 Preparing Entries a

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