View Policies Current Attempt in Progress Odin Corporation is in the business of selling cattle. Due...

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View Policies Current Attempt in Progress Odin Corporation is in the business of selling cattle. Due to recent diseases plaguing cattle, Odin is experiencing a cash shortage. Odin issued a $330,400, 6-year, zero-interest-bearing note to Big City Corp. on January 1, 2023, and received $236,000 cash. In addition, to conserve cash, Odin agreed to sell cattle to Big City for an amount'less than the regular selling price over the 6-year period. The market interest rate for similar notes is 8%. Odin uses the effective interest method. (a) Calculate the present value of the note on January 1 using (1) a financial calculator or (2) Excel function PV. (Hint: Refer to Chapter 3 for tips on calculating.) (Round answer to O decimal places eg. 58,971.) Present value of the note $ (b) Prepare Odin's January 1 journal entry. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answer to 0 decimal places eg. 58,971.) Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Account Titles and Explanation Debit Credit View Policies Current Attempt in Progress Odin Corporation is in the business of selling cattle. Due to recent diseases plaguing cattle, Odin is experiencing a cash shortage. Odin issued a $330,400, 6-year, zero-interest-bearing note to Big City Corp. on January 1, 2023, and received $236,000 cash. In addition, to conserve cash, Odin agreed to sell cattle to Big City for an amount'less than the regular selling price over the 6-year period. The market interest rate for similar notes is 8%. Odin uses the effective interest method. (a) Calculate the present value of the note on January 1 using (1) a financial calculator or (2) Excel function PV. (Hint: Refer to Chapter 3 for tips on calculating.) (Round answer to O decimal places eg. 58,971.) Present value of the note $ (b) Prepare Odin's January 1 journal entry. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answer to 0 decimal places eg. 58,971.) Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Account Titles and Explanation Debit Credit

Answer rating: 100% (QA)

Solution a In zero coupon bond no Interest is duereceived So Present Value would be discounted cash ... View the full answer