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Q1. When a company exchanges a note for property, goods, or services, what value does it place on the note:
a. If it bears interest at a reasonable rate and is issued in a bargained transaction entered into at arm's length?
b. I fit bears no interest and/or is not issued in a bargained transaction entered into at arm's length?
Q2. If the recorded value ofa note differs from the face value:
a. Explain how thecompany should account for the difference.
b. Explain how the company should present this difference in the financial statements.
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