ACTG 321 HW 2: Zero-interest bearing note Due date: See the announcement on the D2L Name: * This homework accounts for 5 points. No point will be given if the assignment is past due or incomplete, no work is provided, answers are not specified, or most work is incorrect. One or more points will be deducted if any of your work or answers is incorrect. Sugarland Co. agreed to loan Colby Retail Inc. On 1/1/Year 1. Colby gave a $ 86,000 zero interest-bearing note due in 5 years to Sugarland. Assume that the market interest rate to discount the note is 6%. Instructions: a. Determine the present value of the zero-interest bearing note. You should use an appropriate factor (five decimal places) from tables in Ch. 6. Answer: b. Record the joumal entry Sugarland (i.e. the lender) would make to record the receipt of the note on 1/1/Year 1. Do not provide journal entry from other dates or points will be deducted. Account title Debit Credit Date c. Prepare an amortization schedule for the note using the effective interest method. Year Cash Interest Interest revenue Discount Carrying amount amortized of note Date of receipt End of year 1 End of year 2 End of year 3 End of year 4 End of year 5