Gandalf & Sons receives a 5-year, $20,000 zero interest-bearing note, the present value of which is $11,348.60.
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Question:
Gandalf & Sons receives a 5-year, $20,000 zero interest-bearing note, the present value of which is $11,348.60. What is the implicit interest rate that equates the total cash to be received to the present value of the future cash flows?
A.9%
B.12%
C. 8%
D. 10%
Related Book For
Financial and Managerial Accounting
ISBN: 978-0132497978
3rd Edition
Authors: Horngren, Harrison, Oliver
Posted Date: