Calculate the present value of loan

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Reference no: EM132942363

On January 1, 2020, Cardinals Corp. grants a loan to Pirates Company and receives a $250,000, four-year note, bearing interest at 6% with interest payable semi-annually. The market rate for similar loans with similar credit risks is 8%.

Instructions

Problem a) From the Cardinals' perspective, calculate the present value of this loan. Please round your answer to the nearest dollar.

Problem b) Prepare the journal entry to record this transaction.

Problem c) With proper format and headings, prepare an amortization table for the above-mentioned four-year notes from the inception day to June 30, 2021.

Reference no: EM132942363

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