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What amount of Interest Revenue should ABC recognize

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Question - On January 1, 2020, ABC rendered services to Smith Corporation and accepted a $200,000 note. In exchange, Smith agreed to make (5) annual payments of P&I with the first payment to be made on December 31, 2020. An interest rate of 8% is imputed.

Required: Use the information above to answer the next (4) questions:

1. Determine the amount of (1) PMT of P&I.

2. What amount of Service Revenue should ABC recognize on January 1, 2020?

3. What amount of Interest Revenue should ABC recognize on this note for the year ending December 31, 2021?

4. What is the Carrying Value of the Note Receivable at December 31, 2021?

Reference no: EM132493186

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