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On January 1 , 2 0 X 1 , Entity B sells an item of equipment for $ 1 0 0 , 0 0 0
On January X Entity B sells an item of equipment for $ under a financing agreement that has no stated interest rate. On the date of sale, B transfers control of the equipment to the customer. The first annual installment of $ is due on December X one year from the date of sale, and each subsequent year for five years. The policy of not charging interest is consistent with normal industry practice. Entity B has separately determined that the transaction includes a significant financing component. Entity B determines that the appropriate annual rate is percent. Assume that the receivable arising from the transaction is measured at amortized cost after initial recognition
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