On January 1, 2022, Balance Bar Co. lends Bio Foods $100,000 in exchange for a $100,000, 5-year note bearing interest at 8 percent annually. The market rate of interest for a note of similar risk is also 8 percent. a. How does Balance Bar record the receipt of the note? b. And how does Balance Bar record the receipt of interest at the end of the first year? c. At the end of the second year?
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1. On January 1, 2022, Balance Bar Co. lends Bio Foods $100,000 in exchange for a $100,000, 5-year note bearing interest at 8 percent annually. The market rate of interest for a note of similar risk is also 8 percent.
a. How does Balance Bar record the receipt of the note?
b. And how does Balance Bar record the receipt of interest at the end of the first year?
c. At the end of the second year?
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- Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?2. On July 1, 2019, XYZ Co. borrowed P2,000,000 and Issued a one-year promissory note. The lender discounted the note at 12%. (a) Give the journal entries on July 1, 2019, December 31, 2019 to accrue interest on the note and July 1, 2020, upon maturity of the note. (b) What is the carrying amount of the note payable as of July 1, 2019 and December 31, 2019. Show them in good form. *(b) On April 1, 2025, Marigold Company assigns $505,300 of its accounts receivable to the Third National Bank as collateral for a $327,200 loan due July 1, 2025. The assignment agreement calls for Marigold to continue to collect the receivables. Third National Bank assesses a finance charge of 4% of the accounts receivable, and interest on the loan is 10% (a realistic rate of interest for a note of this type). (a) Your answer is correct. Prepare the April 1, 2025, journal entry for Marigold Company. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation Apr. 1, Cash 2025 Interest Expense Notes Payable eTextbook and Media List of Accounts Debit 306988 20212 Credit 327200 Attempts: 1 of 2 used Prepare the journal entry for Marigold's collection of $378,200 of the…
- On 1 January 2022, Rodney Inc. provided services to Smith Co. in exchange for Smith’s $300,000, 2-year 8% note with interest compounded semi-annually on July 1 and January 1. The current market rate of similar notes is 12%. Rodney Inc. financial year ends December 31. REQUIRED: 1. Provide the following input values from your financial calculator: N = I/Y = PMT = FV = 2. The note was issued at = 3. The present value of the note is =2. On January 1, 2022, Balance Bar Co. receives a 5-year, $100,000 zero-interest-bearing note for services they provided. The market rate of interest for a note of similar risk is 6 percent. a. How does Balance Bar record the receipt of the note? b. And how does Balance Bar record interest revenue at the end of the first year?c. At the end of the second year?6. On 1/1/2018, Jambo Group makes a loan to Marie Co. and receives in exchange a five-year, $50,000 note bearing interest at 6 percent annually (on 31/12 of every year). The market rate of interest for a note of similar risk is 12 percent. Calculate the amount of Interest revenue that will be recognized on 31/12/2018.
- On January 1, 2022, Easy Company sold merchandise for 500,000 by accepting a note for 6 months with interest to be paid at maturity at 12%. On March 1, the entity discounted the note without recourse at a bank with a 15% discount. How much is the maturity value of the notes receivable?29.On September 12, 2021, an entity received a 120-day, 9% note for P50,000 for an overdue account from a customer. The entity uses an accounting year that ends on December 31. Which of the following statements is true? Use 360-day year.A. The maturity date of the note is January 12, 2022.B. The maturity value of the note is P51,500.C. Accrued interest on the note at December 31, 2021 is P1,375. a. A, B, and C b. A and B only c. B and C only d. B onlyOn January 1, 2019, Love Co. sold merchandise to Kit Store in exchange for a non-interest bearing note requiring 10 annual payments of P100,000. Kit Store made the first payment on December 31, 2019. The prevailing market interest rate for similar notes is 8%. a. How much is the value of notes receivable as of December 31, 2020? b. How much is the Interest income recognized during 2020?
- 22. Subject :- Accounting On August 1, 2022, Colombo Company's treasurer signed a note promising to pay $120,300 onDecember 31, 2022. The proceeds of the note were $116,100.b. Calculate the effective interest rate (APR) on the loan.Note: Enter your answer as a percentage rounded to 1 decimal place (i.e., 32.1).Effective interest rateOn January 1, 2024, Wildhorse Company issued for cash a $570000, 5-year note bearing annual interest at 10% to Wilson, Inc. The market rate of interest for a note of similar risk is 12%. What interest expense would be recorded on December 31, 2024? a) $52891b) $0c) $63469d) $57000On August 31, 2023, an entity discounted with recourse a note at the bank at discount rate of 15%. The note was received from the customer on August 1, 2023 for 90 days with face amount of P9,000,000 and an interest rate of 12%. The discounting transaction is accounted for as secured borrowing. The customer paid the note to the bank on October 30, 2023, the date of maturity. 4. What is the interest expense to be recognize on August 31, 2023? Group of answer choices 90,000 51,750 231,750 270,000 The entry on October 30, 2023 will include Group of answer choices Debit to notes receivable discounted P9,000,000 Debit to loans payable P9,038,250 Credit cash P9,000,000 Debit to loans payable P9,000,000