Blue Spruce Corp. had the following long-term receivable account balances at December 31, 2016.

Notes receivable - Sale of division

$1,785,900

Notes receivable - Employees

380,000

Transactions during 2017 and other information relating to Blue's long-term receivables were as follows:

1.

The $1,785,900 note receivable is dated May 1, 2016, bears interest at 9%, and represents the balance of the consideration received from the sale of Blue's electronics division to Crane Company. Principal payments of $595,300 plus appropriate interest are due on May 1, 2017, 2018, and 2019. The first principal and interest payment was made on May 1, 2017. Collection of the note instalments is reasonably assured.

2.

The $380,000 note receivable is dated December 31, 2016, bears interest at 8%, and is due on December 31, 2019. The note is due from Marcia Cumby, president of Blue Spruce Corp., and is secured by 10,400 Blue's common shares. Interest is payable annually on December 31, and the interest payment was made on December 31, 2017. The quoted market price of Blue's common shares was $45 per share on December 31, 2017.

3.

On April 1, 2017, Blue's sold a patent to Sheridan Company in exchange for a $201,000 noninterest-bearing note due on April 1, 2019. There was no established exchange price for the patent, and the note had no ready market. The prevailing rate of interest for a note of this type at April 1, 2017, was 12%. The present value of $1 for two periods at 12% is 0.79719 (use this factor). The patent had a carrying amount of $39,400 at January 1, 2017, and the amortization for the year ended December 31, 2017 would have been $8,000. The collection of the note receivable from Sheridan is reasonably assured.

4.

On July 1, 2017, Blue's sold a parcel of land to Larkspur Inc. for $214,000 under an instalment sale contract. Larkspur made a $55,000 cash down payment on July 1, 2017, and signed a four-year, 11% note for the $159,000 balance. The equal annual payments of principal and interest on the note will be $51,250, payable on July 1, 2018, through July 1, 2021. The land could have been sold at an established cash price of $200,000. The cost of the land to Blue's was $145,500. Collection of the instalments on the note is reasonably assured.

5.

On August 1, 2017, Blue's agreed to allow its customer, Saini Inc., to substitute a six-month note for accounts receivable of $200,000 it owed. The note bears interest at 6% and principal and interest are due on the maturity date of the note.

The tables in this problem are to be used as a reference for this problem. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.)