Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On December 31, 2020, Nash Company signed a $1,284,300 note to Crane Bank. The market interest rate at that time was 12%. The stated interest

image text in transcribed
image text in transcribed
image text in transcribed
On December 31, 2020, Nash Company signed a $1,284,300 note to Crane Bank. The market interest rate at that time was 12%. The stated interest rate on the note was 10%, payable annually. The note matures in 5 years. Unfortunately, because of lower sales, Nash's financial situation worsened on December 31, 2022, Crane Bank determined that it was probable that the company would pay back only $770,580 of the principal at maturity. However, it was considered likely that interest would continue to be paid, based on the $1.284,300 loan (a) Your answer is correct. Determine the amount of cash Nash received from the loan on December 31, 2020. (Round present value factors to 5 decimal places, es. 0.52513 and final answer to O decimal places. es. 5.275.) Amount of cash Nash received from the loan 1191712 $ (b) Your answer is correct. Prepare a note amortization schedule for Crane Bank up to December 31, 2022. (Round answers to decimal places, eg. 5,275) Note Amortization Schedule (Before Impairment) Cash Received Interest Revenue Increase in Carrying Amount Carrying Amount of Note $ 1191712 128430 $ 143005 $ 14575 1206287 128430 144754 16324 1222611 (c) Determine the loss on impairment that Crane Bank should recognize on December 31, 2022. (Round present value factors to 5 decimal places, s. 0.52500 and final answer to decimal places, s. 5.275.) Loss due to impairment $

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

Recommended Textbook for

Management Accounting For Decision Makers

Authors: Dr Peter Atrill, Eddie McLaney

6th Edition

0273731521, 9780273731528

More Books

Students also viewed these Accounting questions

Question

=+d) Perform the ANOVA and report your conclusions.

Answered: 1 week ago

Question

Does your message present a conclusion?

Answered: 1 week ago