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On October 1, 2018, Justine Company purchased equipment from Napa Inc. in exchange for a noninterest-bearing note payable in five equal annual payments of $500,000,

On October 1, 2018, Justine Company purchased equipment from Napa Inc. in exchange for a

noninterest-bearing note payable in five equal annual payments of $500,000, beginning Oct 1,

2019. Similar borrowings have carried an 11% interest rate. The equipment would be recorded at:

A) $2,500,000.

B) $2,225,000.

C) $1,847,950.

D) $2,115,270.

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