Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

ABC Corp received a 5 month note for $5,140 on April 5th in exchange for an overdue Accounts Receivables. The note has an interest rate

ABC Corp received a 5 month note for $5,140 on April 5th in exchange for an overdue Accounts Receivables. The note has an interest rate of 8% per annum while the market's rate is at 6%. The note is collected in full at maturity and ABC Corp. does the appropriate journal entry and posting. For simplicity of calculations consider the year has 364 days, 52 weeks and 4 quarters. Required 1: If the note has biweekly compounded interest, the total amount of principal received by ABC Corp at maturity is: $ Required 2: If the note has monthly compounded interest, the total amount of interest received by ABC Corp at maturity is: $ Required 3: The amount (simple interest plus principal) received by ABD Corp at maturity is: $ Required 4: If the note has biweekly compounded interest and it is sold to a third party on May 5th, the total amount of interest accrued by ABC Corp until the moment of sale is: $ Required 5: If the note has monthly compounded interest and it is sold to a third party on May 5th, the total amount of interest accrued by ABC Corp until the moment of sale is: $ Instructions: Use 2 decimal places and only type the number without signs except for negative numbers that are preceded by a minus sign ".". If the right answer is 1070.39 you type "1070.39", it will not be read as correct if you type "1,070.39". "$1070.39" or any other combination. If the right answer is negative 1070.39 you type "-1070.39"

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions