Problem 7-9 Teal Inc. had the following long-term receivable account balances at December 31, 2016 Note receivable from sale of division Note receivable from officer Transactions during 2017 and other ieformation relating to Teal's long-term receivables were as follows $1.200,000 437,000 The $1,200,000 note receivable is dated May 1, 2016, bears interest at 10%, and represents the balance of the consideration received from the sale of Teal's electronics division to fNew York Company. Principal payments of $400.000 plus appropriate interest are due on May 1, 2017, 2018, and 2019. The first principal and interest payment vias made on May 1, 2017, Collection of the note installnents is reasonably assured. The s437,000 note recevable . dated December 31, 2016, bears interest at 5% and Sean Hay, president of Teal Inc, and is collateraliaed by 10.925 shares of Teal's common stock. Teterest is payable and all interest payments were paid on their due dates through December 31. 2017. The quobed market price of Teal's common stock was 1. 2. due on December 31, 2019 The note is due from on December 31 $45 per share on December 31, 2017 3. On April 1, 2017, Teal sold a patent to Pennsylvania Company in exschange for a $139,000 zero-interest-bearing note due on April 1. 2019. ready madat T-preetg rate d i terest for ' ete of the There was no estabshed exchange price for the patent i d the note had type at Apra 1. 2017, was 13%. The present value cis: For tio periods at 13% is 0.783 (ude th factor, na pater, had arry ng value of $25,000 at January 1. 2017. and the amorttation for the year ended December 21, 2017, would have been sia20the colecton er the note recelvable Srom Pennaylivania is reasonably assured. 4 On July 1, 2017, Teal sold a parcel of land to Splinter Company for $:86.200 under an installment sale contract. Splinter made a $55.60 cash down prm nt o Mly 1 2017, and igned . 4"yer i2% ,eta for the $130.340 balance. The-' annual paymendp Opal and nterest on the nete will be $43.430 payable on July 1,2018, through July 1, 2021. The land could have been sold at an established cash price of Prepars the long-term receivables section of Teal's balance sheet at December 31. 2017, (Round anewers to O decimal places ag 3125) Version 4.24.12.7 DELL