Question

Lincoln Company purchased merchandise from Grandville Corp. on September 30, 2011. Payment was made in the form of a noninterest-bearing note requiring Lincoln to make six annual payments of $5,000 on each September 30, beginning on September 30, 2014.

Required:
Calculate the amount at which Lincoln should record the note payable and corresponding purchases on September 30, 2011, assuming that an interest rate of 10% properly reflects the time value of money in this situation.



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  • CreatedJune 24, 2013
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