Question
On January 1, 2016, Byner Company purchased a used tractor. Byner paid $3,000 down and signed a noninterest-bearing note requiring $44,000 to be paid on
On January 1, 2016, Byner Company purchased a used tractor. Byner paid $3,000 down and signed a noninterest-bearing note requiring $44,000 to be paid on December 31, 2018. The fair value of the tractor is not determinable. An interest rate of 11% properly reflects the time value of money for this type of loan agreement. The companys fiscal year-end is December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
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