When a company exchanges a note for property, goods, or services,what value does it place on the note: a. If it bearsinterest at a reasonable rate and is issued in a bargainedtransaction entered into at arms length? b. Ifit bears no interest and/or is not issued in a bargainedtransaction entered into at arms length?

2. If the recorded value ofa note differs from the face value: a. Explain how thecompany should account for the difference. b. Explainhow the company should present this difference in the financialstatements.