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By December 31, 2020, Novak Corp. had performed a significant amount of environmental consulting services for Wildhorse Ltd. Wildhorse was short of cash, and Novak

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By December 31, 2020, Novak Corp. had performed a significant amount of environmental consulting services for Wildhorse Ltd. Wildhorse was short of cash, and Novak agreed to accept a $225,000, non-interest-bearing note due December 31, 2022, as payment in full. Wildhorse is a bit of a credit risk and typically borrows funds at a rate of 15%. Novak is much more creditworthy and has various lines of credit at 9%. Novak Corp. reports under IFRS. The tables in this problem are to be used as a reference for this problem. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Prepare the journal entry to record the transaction on December 31, 2020, for Novak Corp. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Debit Credit Account Titles and Explanation Part 2 Assuming Novak's fiscal year end is December 31, prepare the journal entry required at December 31, 2021. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit Part 3 Assuming Novak's fiscal year end is December 31, prepare the journal entry required at December 31, 2022. (Round answers to O decimal places, eg. 58,971. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Debit Credit Account Titles and Explanation (To record interest income) (To record maturity) Part 4 What are the amount and classification of the note on Novak Corp's statement of financial position as at December 31, 2021? (Round answer to decimal places, eg. 58,971.) The balance of the note at December 31, 2021 $ The note would be classified as a on the balance sheet Part 5 Assume instead that Novak reports under ASPE and uses the straight-line method to amortize the discount on the note. What would the interest income be relating to the note for 2021 and 2022? (Round answer to decimal places, e.g. 58,971.) Interest income for 2021 $ Interest income for 2022 $

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