*DO NOT ROUND OFF ANY ANSWER UNTILL YOUR FINAL ANSWER. ROUND YOUR FINAL ANSWER TO THE NEAREST WHOLE DOLLAR*

Present value of an ordinary annuity

periods 3 5 9 10 4% 2.77 4.45 7.43 8.11 8% 2.57 3.99 6.25 6.71

On april 1,2020, ABC company rendered services to jones company in exchange for 3 year $400000 ,8% note. Payments of P&I (principal & interest) are due each april 1st, with the first payment due immediately. December 31st is the fiscal year end for ABC. Jones normal cost to borrow is 8%.

a) Determine the dollar amount of the cash payment of P&I to be remitted each april 1st.

b) Determine the total interest revenue that ABC will recognise on this note for the year end December 31, 2021.

c) Prepare partial balance sheet as of December 31 2020.

Current assets

Interest receivable __________

Notes receivable( current maturity) __________

Long term investments

Notes receivable. _________

#HINT: PVAD = PVOA (1+ i)