Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. cypress oil company's december 31, 2021, balance s

Cypress Oil Company's December 31, 2021, balance sheet listed $645,000 of notes receivable and $16,000...

90.2K

Verified Solution

Question

Accounting

image
Cypress Oil Company's December 31, 2021, balance sheet listed $645,000 of notes receivable and $16,000 of interest receivable included in current assets. The following notes make up the notes receivable balance: Note 1 Dated 8/31/2021, principal of $300,000 and interest at 109 due on 2/28/2022. Note 2 Dated 6/30/2021, principal of $150,000 and interest due 3/31/2022. Note 3 $200,000 face value noninterest-bearing note dated 9/30/2021, due 3/31/2022. Note was issued in exchange for merchandise. The company records adjusting entries only at year-end. There were no other notes receivable outstanding during 2021, Required: 1. Determine the rate used to discount the noninterest-bearing note. 2. Determine the explicit interest rate on Note 2 (Round your intermediate calculations to the nearest whole dollar amount.) 3. What is the amount of interest revenue that appears in the company's 2021 income statement related to these notes? % 1. 2. Discount rate Interest rate Interest revenue % IL 3

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students