Question

Ransopher Corporation needs to buy a new computer system. Dwell Computers has agreed to sell Ransopher a computer system and accept a 10-year, noninterest-bearing note payable. The market rate of interest is currently 7 percent compounded annually and the value of the computer system is $ 53,000.
Required:
A. What is the face value of the noninterest- bearing note?
B. Prepare a spreadsheet that indicates the interest cost associated with the loan each year and the carrying value of the loan at the end of each year. Visit the text Online Learning Center at www.mhhe.com/ ainsworth6e for additional problem material that accompanies this chapter.


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  • CreatedMarch 25, 2015
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