On January

1,2014,JG

purchased a machine and gave a

$30,000

three-year,

8%

note. The market or "going" interest rate was

12%

. The annual interest payments are to be paid on each December 31. On January 1,2014, JG should record the net liability amount determined as follows:\ Select one:\ a. Compute the present value of its face amount and the three

$2,400

interest amounts by using a discount rate of

8%

.\ b. Compute the present value of its face amount and the three

$2,400

interest amounts by using a discount rate of

12%

.\ c. Use its face amount,

$30,000

plus the

$7,200

interest.\ d. Use its face amount,

$30,000

minus

$7,200

interest.

On January 1,2014, JG purchased a machine and gave a $30,000 three-year, 8% note. The market or "going" interest rate was 12%. The annual interest payments are to be paid on each December 31 . On January 1,2014,J should record the net liability amount determined as follows: Select one: a. Compute the present value of its face amount and the three $2,400 interest amounts by using a discount rate of 8%. b. Compute the present value of its face amount and the three $2,400 interest amounts by using a discount rate of 12%. c. Use its face amount, $30,000 plus the $7,200 interest. d. Use its face amount, $30,000 minus $7,200 interest