Determine the present value of the note payable at december

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QUESTION 1 - On January 1, 2019, Bella Aldama purchased a franchise right from Sergio Company at 5,000,000 in a period years of 10. The term of payments includes a down payment in cash of 20% and the balance is payable in 5 equal payments every end of the year, by issuing a noninterest-bearing note. The effective rate is 12%. The entity used 4 decimal places. Determine the franchise cost on January 1, 2019.

QUESTION 2 - On January 1, 2019, Bella Aldama purchased a franchise right from Sergio Company at 5,000,000 in a period in years of 10. The term of payments includes a down payment in cash of 20% and the balance is payable in 5 equal payments every end of the year, by issuing a noninterest bearing note. The effective rate is 12%. Determine the present value of the note payable at December 31, 2019.

Reference no: EM133067050

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