E14-18 Note with unrealistic interest rate; lender; amortization schedule. Amber Mining and Miling, Inc., contracted with Truax Corporation to have constructed a custom-made lathe. The machine was completed and ready for use on January 1, 2016. Amber paid for the lathe by issuing a $600,000, 3 year note that specified 4% interest, payable annually on December 31 of each year. The cash market price of the lathe was unknown. It was determined by comparison with similar transactions that 12% was a reasonable rate of interest. 1. Prepare the journal entry on January 1, 2016 for Truax Corporation's sale of the lathe. 2. Prepare and amortization schedule for the three-year term of the note. 3. prepare the journal entries to record (a) interest for each of the three years and (b) payment of the note at the maturity for Truax.
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “E14-18 Note with unrealistic interest rate; lender; amortization schedule. Amber Mining and Miling, Inc., contracted with Truax Corporation ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Volunteer Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1, 2018 and received $540,000. Interest is payable annually. The premium is amortized using the straight-line method.
Answers (1)
Kelsey and Cody have been making payments on this furniture for 18 months, but Cody gets laid off from his job, and their income drops substantially. They are unable to stay current on their account even though they have paid $2,070 of the bill.
Answers (1)
How can the new environment of global protectionism, (i. e.; increasing tariffs and trade restrictions) affect a firm's strategic initiatives and how it may position itself to strategically succeed in this new environment.
Answers (1)
Assuming the wage-employment tradeoff exists, if labor in a particular geographic area is homogeneous and the unionized workers successfully negotiate a higher wage rate, then Group of answer choices nonunion workers will also experience an increase
Answers (1)
Avicorp has a $10 million debt issue outstanding, with a 6% coupon rate. The debt has semiannual coupons, the next coupon is due in six months, and the debt matures in five years. It is currently priced at 95% of par value. a.
Answers (1)
New Questions in Business
If berkeley shirtmakers ties compensation directly to output by paying an employee a certain amount for each unit of output produced, it is using
Answers (1)
The dramatic growth in american exports in the last years of the twentieth century was mainly indicative of
Answers (1)
An agreement to settle a debt for less than the sum claimed is referred to as? a.? rescission. b. a satisfaction. c.? an accord. d.? a promisory estoppel.
Answers (1)
In economics, what is logrolling?
Answers (1)
In year 1 the CPI is 140, and in year 2 the CPI is 154. From year 1 to year 2, Maria's salary rises from $43,000 to $48,000, and Daisy's salary rises from $65,000 to $70,000. Who is "more than keeping up with inflation"?
Answers (2)