Fleak Corporation borrows money by issuing a three- year periodic and lump- sum payment note payable with

Question:

Fleak borrows money by issuing a three- year periodic and lump- sum payment note payable with a of $ 300,000 and a face rate of 7 percent that is paid annually. The market rate of interest is 6 percent when Fleak takes this note to the bank. What will be the cash inflows shown on the budgeted statement of cash flows? What will be the cash outflows shown on the budgeted statement of cash flows for the first year? What is the amount of interest expense shown on the budgeted income statement for the first year? Why is this latter amount different than the cash outflows for the first year?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...