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What amount should be debited to the asset account

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Question - On January 1, 2012 Silverstein Ltd. purchased a machine. The seller agreed that a total of $12,000 would be paid over a three-year period--$4,000 per year at the end of 2012, 2013, and 2014. At the time the machine was purchased, the market rate of interest was 8%. What amount should be debited to the asset account, Machinery, on the date of purchase?

a. $11,308

b. $9,308

c. $10,308

d. $8,308

e. Some other amount

Reference no: EM132751072

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