As payment for services rendered, the company received a 36-month note on January 1. The face amount

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As payment for services rendered, the company received a 36-month note on January 1. The face amount of the note is $1,000; the note is non-interest-bearing. There is no reasonable basis for determining the cash price of the services rendered. The market rate of interest is 10%, compounded annually. The $1,000 face amount of the note will be received at the end of the 36-month period. Make all journal entries necessary on the books of the recipient of the note during the 36-month life of this note. Don’t forget any necessary year-end adjusting entries.


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Intermediate Accounting

ISBN: 978-0324592375

17th Edition

Authors: James D. Stice, Earl K. Stice, Fred Skousen

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