Journal entries ( especially for number 2 explain) 1. Truck...
70.2K
Verified Solution
Link Copied!
Question
Accounting
Journal entries ( especially for number 2 explain)
1.
Truck #1 has a list price of $22,350 and is acquired for a cash payment of $20,711.
2.
Truck #2 has a list price of $23,840 and is acquired for a down payment of $2,980 cash and a zero-interest-bearing note with a face amount of $20,860. The note is due April 1, 2018. Culver would normally have to pay interest at a rate of 10% for such a borrowing, and the dealership has an incremental borrowing rate of 8%.
3.
Truck #3 has a list price of $23,840. It is acquired in exchange for a computer system that Culver carries in inventory. The computer system cost $17,880 and is normally sold by Culver for $22,648. Culver uses a perpetual inventory system.
4.
Truck #4 has a list price of $20,860. It is acquired in exchange for 990 shares of common stock in Culver Corporation. The stock has a par value per share of $10 and a market price of $13 per share
2.
Trucks
SOLUTION
=
PV of $20,860 @ 10% for 1 year
=
$20,860 0.90909
=
$18,964
$18,964 + $2,980
=
$21,944
how do u get .90909
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
