Question
Sage Hill Inc. provided several entertainment services to Riverbed Corporation in the past. On January 1, 2020, when the receivable for the past services was
Sage Hill Inc. provided several entertainment services to Riverbed Corporation in the past. On January 1, 2020, when the receivable for the past services was due, Riverbed was unable to pay the outstanding balance. Sage Hill Inc. agreed to accept a $460,000 non-interest bearing note payable on December 31, 2021. Riverbed typically could arrange this kind of financing at an interest rate of 15%.
(a) Use 1. PV.1 Tables, 2. a financial calculator, or 3. Excel functions to arrive at the amount to record the note receivable. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 8,971.)
Note receivable $
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