Question
On January 1, 2020, Gibson Co. purchases equipment having a fair value of $200,000 by issuing a three-year, zero-interest-bearing note in the amount of $251,942.
On January 1, 2020, Gibson Co. purchases equipment having a fair value of $200,000 by issuing a three-year, zero-interest-bearing note in the amount of $251,942. The effective interest rate on the note is 8%. How much interest should Gibson recognize on the note in the year ended December 31, 2020?
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Accounting Information And Equity Valuation Theory, Evidence, And Applications
Authors: Guochang Zhang
1st Edition
1461481597, 9781461481591
