Problem 4.

Problem 4 At year-end, Jet Company received two Pl,000,000 notes receivable from customers in exchange for services rendered. On both notes, interest is calculated on the outstanding principal balance at the annual rate of 3% and payable at maturity. The note from Hart Company, made under customary trade terms, is due in nine months and the note om Maxx Company is due in ve years. The market interest rate for similar notes at year-end was 8%. The compound interest factors to convert future value into present value at 8% follow: Present value of 1 due in nine months .944 Present value of 1 due in ve years .680 What is the total carrying amount of notes receivable at year-end