On December 31, 2020, Concord Company signed a $1,035,300 note to Marigold Bank. The market interest rate
Question:
On December 31, 2020, Concord Company signed a $1,035,300 note to Marigold Bank. The market interest rate at that time was 11%. The stated interest rate on the note was 9%, payable annually. The note matures in 5 years. Unfortunately, because of lower sales, Concord’s financial situation worsened. On December 31, 2022, Marigold Bank determined that it was probable that the company would pay back only $621,180 of the principal at maturity. However, it was considered likely that interest would continue to be paid, based on the $1,035,300 loan.
Determine the amount of cash Concord received from the loan on December 31, 2020. (Round present value factors to 5 decimal places, e.g. 0.52513 and final answer to 0 decimal places, e.g. 5,275.)
| Amount of cash Concord received from the loan | $enter a dollar amount of cash Concord received from the loan |
eTextbook and Media
- eTextbook
Prepare a note amortization schedule for Marigold Bank up to December 31, 2022. (Round answers to 0 decimal places, e.g. 5,275.)
Note Amortization Schedule | ||||||||
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| Increase in | Carrying | ||||
12/31/20 | $enter a dollar amount | |||||||
12/31/21 | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | enter a dollar amount | ||||
12/31/22 | enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | ||||
eTextbook and Media
- eTextbook
Determine the loss on impairment that Marigold Bank should recognize on December 31, 2022. (Round present value factors to 5 decimal places, e.g. 0.52500 and final answer to 0 decimal places, e.g. 5,275.)
| Loss due to impairment | $enter the Loss due to impairment in dollars |
Expert Answer:
Amount of Interest 1035300 9 Present value of principal 1035300 59345 Present ... View the full answer
