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?

$0

$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?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Relative advantages of partnership

What are the relative advantages of partnership versus limited partnership as a form of doing business? What legal principles are most likely to bite partnerships?

  Partnerships sale of the land

During 2010, the partnership sold the land for $85,000 to an unrelated third party. What amount of gain from the partnership's sale of the land should be allocated to Beth?

  Equivalent units for conversion costs

Equivalent units for materials total 20,000. There were 16,000 units completed and transferred out. Equivalent units for conversion costs equals 18,000. How much are the physical units for conversion costs if ending work in process is 50% complete..

  How can one contribute appreciated property without gain

Relative to corporate formation, how can one contribute appreciated property without gain recognition to the transferor?

  Tax and consulting services problem

Precision Tax Service offers tax and consulting services to individuals and small businesses. Data for fees and costs of three types of tax returns follow. Precision provides services in the ratio of 5:3:2 (easy, moderate, business).

  Acquisition cost of the equipment

The depreciation applicable to this equipment was $70,000 for 2008, computed under the sum-of-the-years'-digits method. What was the acquisition cost of the equipment?

  Determine ending inventories of direct materials

Determine ending inventories of Direct Materials, Work In Process, and Finished Good,  Draft an insurance claim letter for the controller,seeking reimbursment for the damage to invemtory.

  Material sale of inventory items by a parent company

The material sale of inventory items by a parent company to an affiliated company:

  Stock after the distribution

Dixie Corporation distributes $31,000 to its sole shareholder, Sally. At the time of the distribution, Dixie's E&P is $25,000 and Sally's basis in her Dixie stock is $10,000. Sally's basis in her Dixie stock after the distribution is ??

  What is the service design matrix

What is the service design matrix? Find a peer-reviewed journal article which addresses this concept. Provide a brief summary of the article.

  What is the cost of the land

The following expenditures were incurred by obermeyer company in purchasing land: cash price $68,011, accrued taxes $3,3618, attorney's fees $2,877, real estate broker's commission $1,189, and clearing and grading $4,045. What is the cost of the l..

  Dollar amount of the worksheet elimination

In the preparation of the 2006 consolidated financial statements, what is the dollar amount of the worksheet elimination to 2006 Retained Earnings with respect to this transaction?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd