A partial amortization schedule for a five-year note payable that Puro Co. issued on January 1, 2010, is shown here:

Accounting Period	Principal Balance January 1	Cash Payment	Applied to Interest	Applied to Principal
2010	$100,000	$25,046	$8,000	$17,046
2011	82,954	25,046	6,636	18,410

3.

value: 1.00 points

Requirement 1:

What rate of interest is Puro Co. paying on the note? (Omit the "%" sign in your response.)

Rate of interest

%

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4.

value: 1.00 points

Requirement 2:

Using a financial statements model like the one shown below, record the appropriate amounts for the following two events: (In the Cash Flow column, use the initials OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for net change in cash. Amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

(1)	January 1, 2010, issue of the note payable.
(2)	December 31, 2010, payment on the note payable.

Effect of Transactions on Financial Statements

Balance Sheet

Income Statement

Statement of

Event No.

Assets

=

Liab.

+

S. Equity

Rev.

-

Exp.

=

Net Inc.

Cash Flows

1.

(Click to select)IAOANAFA

2.

(Click to select)FAIANAOA

(Click to select)NAOAIAFA

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5.

value: 1.00 points

Requirement 3:

If the company earned $75,000 cash revenue and paid $35,000 in cash expenses in addition to the interest in 2010, what is the amount of each of the following? (Amounts to be deducted except individual expenses should be indicated with minus sign. Omit the "$" sign in your response.)

(a)	Net income for 2010.

Income Statement Puro Co. For the Year Ended December 31 2010
(Click to select)Interest expenseRent expenseRevenuecashDividends		$
Expenses
(Click to select)Operating expensesRent expenseService revenueInterest expenseDividends	$
(Click to select)Interest expenseDividendsOperating expensesRent expenseService revenue
Total Expenses
(Click to select)Net lossNet income		$

(b)	Cash flow from operating activities for 2010.

Cash Flows From Operating Activities:
(Click to select)Outflow to repay noteOutflow for expensesInflow from revenueInflow from issue of noteInflow from customers	$
(Click to select)Inflow from customersOutflow for expensesOutflow to repay noteInflow from revenueInflow from issue of note
Net Cash Flow from Operating Activities	$

(c)	Cash flow from financing activities for 2010.

Cash Flows From Financing Activities:
(Click to select)Outflow to repay noteInflow from customersInflow from revenueOutflow for expensesInflow from issue of note	$
(Click to select)Inflow from revenueOutflow to repay noteInflow from customersOutflow for expensesInflow from issue of note
Net Cash Flow from Financing Activities	$

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6.

value: 1.00 points

Requirement 4:

What is the amount of interest expense on this loan for 2012? (Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)

Interest expense

$