On January 1, 2018, Laramie Inc. acquired land for $6.2 million. Laramie paid $1.2 in...
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Accounting
On January 1, 2018, Laramie Inc. acquired land for $6.2 million. Laramie paid $1.2 in cash and signed a 6% note requiring the company to pay the remaining $5 million plus interest on December 31, 2019. An interest rate of 6% properly reflects the time value of money for this type of loan agreement. For what amount should Laramie record the purchase of land?
Multiple Choice
$6.8 million.
$5.0 million.
$5.6 million.
$6.2 million.
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