Please show all your work for the entries and for the time value of money...
80.2K
Verified Solution
Link Copied!
Question
Accounting
Please show all your work for the entries and for the time value of money please show all calculations in detail.
On Jan. 1,2020, Bobcat Const. purchased equipment from Gallatin Equipment. Bobcat gave a 0% interest $124,905 promissory note payable to Gallatin with the following terms. Scenario 2: Loan terms. The note payable terms requires 3 equal payments of $41,635 on December 31 each year. The current market interest rate for similar loans is 12%. Instructions: Show your calculations! 1) Detemine the fair market value of the note -> 2) Record Bobcats journal entries for 2020. Cash Payment Interest Expense Discount Amortized Unamortized Discount Note Balance Note Carrying Value Date 01/01/20 24,905 124,905 S 100,000 12/31/20 41,635 12.000 12,000 12,905 83,270 S 70,365 12/31/21 41,635 8,444 8,444 4,461 41,635 $ 37,174 12/31/22 41,635 4,461 4,461 0 $ (0) 124,905 24,905 24,905 Accounting Journal Entries Accounting Journal Entries Debit Credit 01/01/20 12/31/20
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!
Please show all your work for the entries and for the time value of money please show all calculations in detail.