On January 1, Year 1, Mission Company agreed to buy some equipment from Anna Company. Mission signed a non-interest-bearing note, agreeing to pay Anna $500,000 for the equipment on December 31, Year 3. The implied rate of interest for this note was 10%.
Record the journal entry for the purchase of this equipment for Mission Company on January 1, Year 1.3. Contingent Liabilities - Warranties Start Chapter 10
|Journal Entry 1|
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|3||Contingent Liabilities - Warranties||Moderate|
Purchasing with a Non-Interest Bearing Note
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|1||Interest Bearing Notes||8:26|
|2||Non-interest Bearing Notes||6:16|
|4||What is Present Value||8:15|
|5||Simple vs Compound||14:41|
|6||PV of a Lump Sum||4:39|
|7||PV of a Lump Sum||6:09|
|9||Purchasing with an Annuity||4:31|
|10||Finding the Payment||6:07|