"Homework Quiz—2

"Homework Quiz—2 - Name Section...

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Name Section Homework Quiz—2 1. You have the following information for ABC Company’s five-year, zero coupon note payable: note issued on September 1, 2010, effective interest rate is 6% with annual compounding assumed, the maturity amount of the note is $800,000 and the amount borrowed is $597,806.54. Required : in the space below prepare a note liability table for this zero coupon obligation; include appropriate column headings and row identifiers. 2. You have the following information for DEF Company’s five-year, 8% note payable: note issued on August 1, 2010. Date Interest Expense Cash Flow Change in Carrying Amount Carrying Amount 8/1/10 199,636 7/31/11 15,971 50,000 -34,029 165,607 7/31/12 13,249 50,000 -36,751 128,856 7/31/13 10,308 50,000 -39,692 89,164 7/31/14 7,133 50,000 -42,867 46,297 7/31/15 3,704 50,000 -46,296 1* *round off 1
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2a : In the space below write DEF’s entry for 8/1/10 2b : In the space below write DEF’s entry for 12/31/10 2c : In the space below write DEF’s entry for 7/31/11 2
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This note was uploaded on 04/09/2011 for the course MGMT 351 taught by Professor Staff during the Winter '08 term at Purdue.

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"Homework Quiz—2 - Name Section...

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