By how much amount the service revue will be credited

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Question - On July 1, 2017, Agincourt Inc. rendered services in exchange for a 4%, 8-year promissory note having a face value of $1,000,000 (interest payable annually). Agincourt Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customer of the above transaction has credit ratings that require them to borrow money at 12% interest.

The present value of 1 at 12% for 8 periods 0.40388

The present value of an ordinary annuity of 1 at 12% for 8 periods 4.9676

Instructions - By how much amount the service revue will be credited?

Reference no: EM132856904

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