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What amount be reported as interest income for zyrus co

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On January 2, 20x3 Zyrus Co. sold equipment with a carrying amount of ?480,000 in exchange for a ?600,000 noninterest bearing note due January 2, 20x6. There was no established exchange price for the equipment. The prevailing rate of interest for a note of this type at January 2, 20x3 was 10%

Problem 1: In Zyrus' 20x3 income statement, what amount should be reported as interest income?

a. 9,000

b. 45,000

c. 50,000

d. 60,000

Problem 2: What are the effects of direct loan origination costs and origination fees to the carrying amount of a loan receivable?

Direct origination costs              Origination fees

a. Deducted                                 added

b. Added                                    deducted

c. Added                                        no effect

d. Deducted                                     no effect

Reference no: EM132836618

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