HW #5 - Prob. A Solution

# HW #5 - Prob. A Solution - 892 19 2,910 3 4,400 1 7 20...

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Solutions to HW #5 Problem A 1. FV = \$220,000 PMT = \$220,000*.02 = \$4,400 (face value * stated rate) N = 3 years i = 9% Compute PV = \$181,018 Dr. Note receivable \$220,000 Cr. Discount on note receivable \$38,982 Cr. Service Revenue 181,018 2. Date Cash Received Interest Revenue Amortizatio n Carrying Value 12/31/2011 18 1,018 12/31/2012 4,400 1 6,292 11,
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Unformatted text preview: 892 19 2,910 12/31/201 3 4,400 1 7,362 12, 962 20 5,872 12/31/201 4 4,400 1 8,528 14, 128 22 0,000 Dr. Cash \$ 4,400 Dr. Discount on note receivable 11,892 Cr. Interest revenue \$16,292 3. Dr. Cash \$224,400 Dr. Discount on note receivable 14,128 Cr. Interest revenue \$18,528 Cr. Note receivable 220,000...
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