y 11 VA A Aa A . de X, XA..A. E. . . 21 cDe 1 Normal 1 No Spac... Heading 1 Heading 2 Title Find Replace Select Editing Font Section Paragraph Group number e r Styles Name(s) 1. The car dealer is offering a promotion on a new that the buyer pays zero interest over 72 months. The monthly payment is $350. The market interest rate for a 6-year car loan is 3.5%. What is the selling price of this car? 2. On May 1, 2018, Callaway Golf Co. purchased machinery from Caterpillar Co. They do not need to pay for the machinery until May 1, 2021. Callaway will pay $2,000,000 to Caterpillar Co. on May 1, 2021. Callaway does not pay any interest and interest compounds annually. The interest rate for Caterpillar to borrow similar amounts from the bank is at 4%. a. Prepare the accounting entry for Caterpillar on May 1, 2018 (assume the machinery is delivered on the same day)? b. How will Caterpillar account for the interest component of the transaction. What is the interest revenue will Caterpillar recognize in 2018 assuming its fiscal year ends on December 31 * A. . Styles ont Paragraph Claratine Co. uses the gross method to record credit sales. On July 1, 2019, Claratine invoiced Smith Co. $75,000 with terms 2/10 n/30. On July 9, 2019, Claratine received full payment for the July 1 invoice. Prepare the required journal entries for Claratine on July 1 and July 9. 3. Hakeem Co. uses the net method to record credit sales. On July 1, 2019. Hakeem invoiced Jones Co. $150,000 with terms 2/10 n/30. On July 21, 2019. Hakeem received full payment for the July 1 sale. Prepare the required journal entries for Hakeem on July 1 and July 21. Search