Question
1. On January 1, 2020, Flint Corporation sold a building that cost $259,320 and that had accumulated depreciation of $102,520 on the date of sale.
1. On January 1, 2020, Flint Corporation sold a building that cost $259,320 and that had accumulated depreciation of $102,520 on the date of sale. Flint received as consideration a $249,320 non-interest-bearing note due on January 1, 2023. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2020, was 11%. At what amount should the gain from the sale of the building be reported? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)
The amount of gain should be reported | $enter a dollar amount of gain should be reported |
2. On January 1, 2020, Flint Corporation purchased 311 of the $1,000 face value, 11%, 10-year bonds of Walters Inc. The bonds mature on January 1, 2030, and pay interest annually beginning January 1, 2021. Flint purchased the bonds to yield 11%. How much did Flint pay for the bonds? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)
Flint must pay for the bonds | $enter a dollar amount should be paid for the bonds |
3. Flint Corporation bought a new machine and agreed to pay for it in equal annual installments of $4,570 at the end of each of the next 10 years. Assuming that a prevailing interest rate of 8% applies to this contract, how much should Flint record as the cost of the machine? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)
Cost of the machine to be recorded | $enter cost of the machine to be recorded in dollars |
4. Flint Corporation purchased a special tractor on December 31, 2020. The purchase agreement stipulated that Flint should pay $18,650 at the time of purchase and $5,190 at the end of each of the next 8 years. The tractor should be recorded on December 31, 2020, at what amount, assuming an appropriate interest rate of 12%? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)
Cost of tractor to be recorded | $enter cost of tractor to be recorded in dollars |
5. Flint Corporation wants to withdraw $123,180 (including principal) from an investment fund at the end of each year for 9 years. What should be the required initial investment at the beginning of the first year if the fund earns 11%? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)
Required initial investment | $enter the required initial investment in dollars |
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