6. Discount on note payable is being computed upon issuance of an 13. When an non-interest bearing note is issued to acquire an asset, interest-bearing note. the asset is debited at an amount equal to the down payment if 7. The carrying amount of note payable when a non-interest bear- there is any plus the face amount of the note. ing note was issued will increase after amortization of the discount 14. The note payable account is credited upon the settlement of the on note payable. note. 8. The trend of the balance of the discount on note payable during 15. Amortization of the discount on note Payable increases the bal- the term of the non-interest bearing note is decreasing. ance of the discount on note payable 9.. The note payable account will be credited at its present value 16. The carrying amount of the note payable is the same all through upon acquisition of a property if the note issued was non-interest out the term of an non-interest bearing note. bearing. 17. Discount on note payable is amortized by crediting it and debit- 10. The difference between the cash price of a property acquired by ing interest expense. issuing a non-interest bearing note and the face amount of the note 18. To record the purchase of a property by issuing a non-interest is debited to discount on note payable. bearing note will involve a credit to note payable . 11. The carrying amount of the note payable is the same all through 19. When an interest bearing note is issued to acquire an asset, the out the term of an interest bearing note . asset is debited at an amount equal to the downpayment if there is any plus the face amount of the note. 12. The trend of the present value of the note during the term of the non-interest bearing note is increasing. 20. The property that is purchased using a non-interest bearing note should be recorded at its cash price if available. If the cashprice of the property is not available, the present value of the note must be computed. End of document