On July 1, 2017, Agincourt Inc. rendered services in exchange for a 4%, 8-year promissory note having a face value of $500,000 (interest payable annually). Agincourt Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customer of the above transaction has credit ratings that require them to borrow money at 12% interest.

The present value of 1 at 12% for 8 periods

0.40388

The present value of an ordinary annuity of 1 at 12% for 8 periods

4.9676

Instructions

By how much amount the service revue will be credited?