UsePresent Value Tablesor your calculator to complete the requirements below.

Phillips Enterprises signed notes to make the following two purchases on January 1, 2020:

1. new piece of equipment for $60,000, with payment deferred until December 31, 2021. The appropriate interest rate is 9% compounded annually.
2. small building from Richter Construction. The terms of the purchase require a $75,000 payment at the end of each quarter, beginning March 31, 2020, and ending June 30, 2022. The appropriate interest rate is 2% per quarter.

1.Complete the information needed to prepare cash flow diagrams for these two purchases.

a.

n =___ years

i =___ % per year

What is the Amount of Payment and Deposit for 1/1/20 12/31/21_________

b.

n =___ quarters

i =___ % per quarter

What is the Amount of Payment and Deposit

• 1/1/20
• 3/31/20
• 6/30/20
• 9/30/20
• 6/30/22

2.Prepare the entries to record these purchases in Phillips' journal.

2020 Jan. 1

(Record purchase of equipment)

2020 Jan. 1

((Record purchase of building)