Question
McGill Corporation purchased some equipment by issuing a $20,000 non-interest-bearing, four-year note when interest rates were 8%. Actuarial information of 8% for four periods follows:
McGill Corporation purchased some equipment by issuing a $20,000 non-interest-bearing, four-year note when interest rates were 8%. Actuarial information of 8% for four periods follows:
| Future amount of 1 | 1.360489 |
| Present value of 1 | 0.735030 |
In the entry to record this purchase, there would be a
| a. | $20,000 debit to Equipment |
| b. | $5,299.40 debit to Discount on Notes Payable |
| c. | $27,209.78 credit to Notes Payable |
| d. | $14,700.60 credit to Equipment |
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ISE Business Accounting
Authors: Frank Wood, Alan Sangster
8th Edition
0273638408, 9780273638407
