Question: ADDITIONAL HOMEWORK PROBLEM FOR CHAPTER7 On 1/1/08 ABC received a 2 year, $400,000 note with a 1% stated interest rate which is payable annually on

ADDITIONAL HOMEWORK PROBLEM FOR CHAPTER7 On 1/1/08 ABC received a 2

ADDITIONAL HOMEWORK PROBLEM FOR CHAPTER7 On 1/1/08 ABC received a 2 year, $400,000 note with a 1% stated interest rate which is payable annually on 12/31. The note was in exchange for land which was owned by ABC and had a book value of $380,000. Assume that a reasonable rate of interest for this transaction is 5%. Required: 1) Calculate the present value of this note imputing interest at the reasonable rate. 2) Prepare a discount amortization schedule under the effective interest method for this note. 3) Prepare all necessary journal entries

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