Question
On January 1, Snipes Construction paid for earth moving equipment by issuing a 350,000, 2 year note that specified 4% interest to be paid on
On January 1, Snipes Construction paid for earth moving equipment by issuing a 350,000, 2 year note that specified 4% interest to be paid on December 31 of each year. The equipments retail cash price was unknown, but it was determined that a reasonable interest rate was 7%
At what amount should Snipes record the equipment and the note?
what journal entry should it record for the transaction?
| n= | ||
| i= | ||
| Loan repayments | Amount | Present Value |
| Interest | ||
| Principal | ||
| Price of equipment |
|
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Managing The Audit Function A Corporate Audit Department Procedures Guide
Authors: Michael P. Cangemi, Tommie W. Singleton
3rd Edition
0471281190, 978-0471281191
