Determine the amount of interest expense to report

Assignment Help Financial Accounting
Reference no: EM13787679

a. On January 1, 2014, Robin Wright Inc. purchased land that had an assessed value of $303,000 at the time of purchase. A $654,000, zero-interest-bearing note due January 1, 2017, was given in exchange. There was no established exchange price for the land, nor a ready fair value for the note. The interest rate charged on a note of this type is 12%.

Determine at what amount the land should be recorded at January 1, 2014, and the interest expense to be reported in 2014 related to this transaction

b. On January 1, 2014, Field Furniture Co. borrowed $4,245,000 (face value) from Gary Sinise Co., a major customer, through a zero-interest-bearing note due in 4 years. Because the note was zero-interest-bearing, Field Furniture agreed to sell furniture to this customer at lower than market price. A 8% rate of interest is normally charged on this type of loan.

Prepare the journal entry to record this transaction.

c. Determine the amount of interest expense to report for 2014.

Reference no: EM13787679

What is value-added ratio-what time does edwards arrive home

Lamar Edwards caught the flu and needed to see the doctor. Edwards called to set up an appointment and was told to come in at 1:00 P.M. Edwards arrived at the doctor's office

The chocolate candy factory process cost accounting

The Chocolate Candy Factory’s Process Cost Accounting. Determine the general journal entry for each of the following transactions. Use the following accounts from the manufact

Calculate profit margin and gross profit rate

Pronghorn Corp reported net sales of $242,400, cost of goods sold of $144,100, operating expenses of $47,000, net income of $36,000, beginning total assets of $518,600, and en

How many units are in ending work in process

In Saint-Simon, Inc., the Assembly Department started 12,000 units and completed 14,000 units. If beginning work in process was 6,000 units, how many units are in ending wo

Rewarded for level of purity it is not providing

Ferguson Metals is a decentralized mining, smelting and metals company with three divisions: mining, lead, and copper. The mining division owns the ore mines that produces the

What is meant by the terms gross risk and residual risk

Don Company is in the precious metals business. A significant part of Don's success has been its willingness to develop gold and silver mines in parts of the world where it is

Determine the inventory at cost

Determine the inventory at cost and also at the lower of cost or market, using the first-in, first-out method. Record the appropriate unit costs on the inventory sheet, and

Associations-organization is resource for accounting

Associations- Describe how this organization is a resource for Accounting. List at least five associations that would be useful for Accounting along with the URL or other loca


Write a Review

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