Question: please help! :) Problem 14-13 (Algo) Note and installment note with unrealistic interest rate [LO14-3] Braxton Technologies, Inc, constructed a conveyor for A&G Warehousers that

please help! :)
please help! :) Problem 14-13 (Algo) Note and installment note with unrealistic

Problem 14-13 (Algo) Note and installment note with unrealistic interest rate [LO14-3] Braxton Technologies, Inc, constructed a conveyor for A\&G Warehousers that was completed and ready for use on January 1, 2021. A\&G pald for the conveyor by issuing a $175,000, four-year note that specified 8% interest to be paid on December 31 of each year, and the note is to be repaid at the end of four years. The conveyor was custom-bulit for A\&G, so its cash price was unknown. By comparison with similar transactions it was determined that a reasonable interest rate was 12%. (EV of $1, PV of $1. EVA of $1, PVA of S1. EVAD of \$1 and PVAD of \$1) (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare the journal entry for A\&G's purchase of the conveyor on January 1, 2021. 2.Prepare an amortization schedule for the four-year term of the note. 3. Prepare the journal entry for A\&G's third interest payment on December 31, 2023. 4.If A\&G's note had been an Installment note to be pald in four equal payments at the end of each year beginning December 31,2021 . what would be the amount of each installment? 5. By considering the installment payment of requirement 4. prepare an amortization schedule for the four-year term of the installment note. 6. Prepare the journal entry for A\&G's third installment payment on December 31, 2023. Complete this question by entering your answers in the tabs below. Prepare the journal entry for A\&G's purchase of the conveyor on January 1, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round intermediate calculations and final answers to the nearest whole dollar.)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!