Eeffective-interest method

Assignment Help Accounting Basics

Reference no: EM13144596

On January 1, 2010, Crown Company sold property to Leary Company. There was no established exchange price for the property, and Leary gave Crown a $2,000,000 zero-interest-bearing note payable in five equal annual installments of $400,000, with the first payment due December 31, 2010. The prevailing rate of interest for a note of this type is 9%. The present value of the note at 9% was $1,442,000 at January 1, 2010. What should be the balance of the Discount on Notes Payable account on the books of Leary at December 31, 2010 after adjusting entries are made, assuming that the effective-interest method is used?

$428,220

$446,400

$558,000

Reference no: EM13144596

Questions Cloud

What are 3 structural adaptations of an octopus : What are 3 structural adaptations of an octopus and what are 3 behavioral adaptations of an octopus?

What is the half life of the phosphours 32 : After 42 days a 2.0 g sample of phosphorus 32 contain only 0.25 g of the isotopt. what is the half life of the phosphours 32 ?

Determine the firm budgeted payables balance : If purchases for April, May, and June were $200,000, $160,000, and $250,000, respectively, what was the firm's budgeted payables balance on June 30?

Which is a function of a hormone transport protein : Which of the following is a function of a hormone transport protein?

Eeffective-interest method : The present value of the note at 9% was $1,442,000 at January 1, 2010. What should be the balance of the Discount on Notes Payable account on the books of Leary at December 31, 2010 after adjusting entries are made, assuming that the effective-in..

What is the ph of the solution : suppose that a 5.0X10^-5 M solution of Ba(OH)2 is prepared. What is the pH of the solution?

Explain what is the the mole fraction of a solution : What is the the mole fraction of a solution prepared by dissolving 0.315 g of cholesterol

Which of these observations are testable : Which of these observations are testable.

How many circuits company provide to block calls : How many circuits should the company provide to ensure that an attempted call is blocked (because all circuits are busy) with probability less than 0.01?

User Account

All Pages