6. On 1/1/2018, Jambo Group makes a loanto Marie Co. and receives in exchange afive-year, $50,000 note bearing interest at 6percent annually (on 31/12 of every year).The market rate of interest for a note ofsimilar risk is 12 percent.Calculate the amount of Interest revenuethat will be recognized on 31/12/2018.

Interest revenue that will be recognized can be computed as follows:

/1/2018, Jambo Group makes a loa to Marie Co. and receives in exchange a five-year, $50,000 note bearing interest at percent annually (on 31/12 of every year). 6. On The market rate of interest for a note of similar risk is 12 percent. Calculate the amount of Interest revenue that will be recognized on 31/12/2018.

/1/2018, Jambo Group makes a loa to Marie Co. and receives in exchange a five-year, $50,000 note bearing interest at percent annually (on 31/12 of every year). 6. On The market rate of interest for a note of similar risk is 12 percent. Calculate the amount of Interest revenue that will be recognized on 31/12/2018.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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On January 1,2022, Ace Company finished landscaping services and accepted in exchange a 10% $400000 promissory note with a due date of December 31,2024. Interest is receivable at December 31 each year. Notes with similar risks have a market rate of interest of 5%. (A.) Determine the value of the following N, I/Y, PMT, FV. B The present value of the note was $_______. (C) Prepare a schedule of Note Discount/Premium Amortization for Ace Company under the effect interest method (D) Prepare the journal entries on the following dates: Jan 1, 2022 and Dec 31, 2023
On January 1,2022, Ace Company finished landscaping services and accepted in exchange a 10% $400000 promissory note with a due date of December 31,2024. Interest is receivable at December 31 each year. Notes with similar risks have a market rate of interest of 5%. (A.) Determine the value of the following N, I/Y, PMT, FV. B The present value of the note was $_______. (C) Prepare a schedule of Note Discount/Premium Amortization for Ace Company under the effect interest method

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