On June 1, 2021, Johnson & Sons sold equipment to James Landscaping Service in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of sale was $100,000. The amount of revenue to be recognized on this transaction in 2021 is

On June 1, 2021, Johnson & Sons sold equipment to James Landscaping Service in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of sale was $100,000. The amount of revenue to be recognized on this transaction in 2021 is

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 10MC: On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major...

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On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
On June 1, 2021, Blossom & Sons sold equipment to James Landscaping Service in exchange for a zero-interest bearing note with a face value of $94800, with payment due in 12 months. The fair value of the equipment on the date of sale was $87000. The amount of revenue to be recognized on this transaction in 2021 is $87000. $94800. $7800. $87000 sales revenue and $4550 interest revenue.
On June 1, 2021, Oriole & Sons sold equipment to James Landscaping Service in exchange for a zero-interest bearing note with a face value of $112800, with payment due in 12 months. The fair value of the equipment on the date of sale was $97200. The amount of revenue to be recognized on this transaction in 2021 is $97200. $112800. $15600. $97200 sales revenue and $9100 interest revenue.
On June 1, 2023, Redwood Manufacturin Co. sold equipment to Caramel Company in exchange for a zero-interest bearing note with a face value of $110,000, with paynent due in 12 months. The fair value of the equipment on the date of the sale was $100,000. The amount of revenue to be recognized on this transaction in 2023 is
On January 1, 2021, Janelle Co. sold equipment to James Inc. in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of the sale was $100,000. Janelle paid $55,000 for the cost of equipment. Record the journal entries for January 1, 2021 What is the amount of revenue to be recognized on this transaction at December 31, 2021?
On July 1, 2020, Agincourt Inc. made two sales. 1. It sold land having a fair value of $700,000 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,101,460. The land is carried on Agincourt’s books at a cost of $590,000. 2. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $400,000 (interest payable annually). Agincourt Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest. Instructions Record the two journal entries that should be recorded by Agincourt Inc. for the sales transactions above that took place on July 1, 2020.
On January 1, 2021, Mumbleford & Sons Co. sold equipment to Mulligan Care Service in exchange for a zero-interest bearing note. The note has a face value of $110,000, with payment due in 12 months. The imputed interest rate is 10%. The fair value of the equipment on the date of sale was $100,000. The amount of revenue to be recognized on this transaction in 2021 is Select one: a. $110,000 sales revenue. b. $100,000 sales revenue. c. $100,000 sales revenue and $10,000 deferred revenue. d. $100,000 sales revenue and $10,000 interest revenue.
On January 1, 2021, Janelle Co. sold equipment to James Inc. in exchange for a zero-interest bearing note with a face value of $110,000, with payment due in 12 months. The fair value of the equipment on the date of the sale was $100,000. Janelle paid $55,000 for the cost of equipment. A. Record the journal entries for January 1, 2021 B. What is the amount of revenue to be recognized on this transaction at December 31, 2021?
On July 1, 2020, Splish Inc. made two sales. 1. It sold land having a fair value of $909,120 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,430,514. The land is carried on Splish's books at a cost of $597,100. 2. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $401,050 (interest payable annually). Splish Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest.Record the two journal entries that should be recorded by Splish Inc. for the sales transactions above that took place on July 1, 2020.
On June 1, 2022, EBD sold equipment to EHL in exchange for a zero-interest bearing note with a face value of P55,000, with payment due in 12 months. The fair value of the equipment on the date of sale was P50,000. How much is the amount of revenue to be recognized on this transaction in 2022? (3 points)
On July 1, 2020, Marin Inc. made two sales: 1. It sold excess land in exchange for a four-year, non–interest-bearing promissory note in the face amount of $1,165,880. The land’s carrying value is $640,000. 2. It rendered services in exchange for an eight-year promissory note having a face value of $480,000. Interest at a rate of 2% is payable annually. The customers in the above transactions have credit ratings that require them to borrow money at 11% interest. Marin recently had to pay 7% interest for money it borrowed from British Bank. 3. On July 1, 2020, Marin also agreed to accept an instalment note from one of its customers in partial settlement of accounts receivable that were overdue. The note calls for four equal payments of $21,000, including the principal and interest due, on the anniversary of the note. The implied interest rate on this note is 9%. Required: 1. Prepare the journal entries to record the three notes receivable transactions of Marin…
On July 1, 2025, Concord Inc. made two sales. 1. It sold land having a fair value of $907,040 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,427,241. The land is carried on Concord's books at a cost of $596,000. 2. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $406,680 (interest payable annually). Concord Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest. Record the two journal entries that should be recorded by Concord Inc. for the sales transactions above that took place on July 1. 2025. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry for the account titles and enter O for the amounts, Credit account titles are automatically indented…