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  • 10-04-2023 (Updates)

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    The document summarizes the sale of land for $350,000, with $100,000 received in cash and $250,000 received via a 5-year, 12% interest note. It provides the journal entries to record the initial sale on Jan 1, 2023 and updates to accrued interest and interest income through 2025. It also calculates the present value of the $250,000 note using annual discount rates of 12% to determine the proper amount of unearned interest income to initially record.

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    10-04-2023 (UPDATES)

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    The document summarizes the sale of land for $350,000, with $100,000 received in cash and $250,000 received via a 5-year, 12% interest note. It provides the journal entries to record the initial sale on Jan 1, 2023 and updates to accrued interest and interest income through 2025. It also calculates the present value of the $250,000 note using annual discount rates of 12% to determine the proper amount of unearned interest income to initially record.

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    8 views3 pages

    10-04-2023 (Updates)

    Uploaded by

    For Purpose
    The document summarizes the sale of land for $350,000, with $100,000 received in cash and $250,000 received via a 5-year, 12% interest note. It provides the journal entries to record the initial sale on Jan 1, 2023 and updates to accrued interest and interest income through 2025. It also calculates the present value of the $250,000 note using annual discount rates of 12% to determine the proper amount of unearned interest income to initially record.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    of 3

    Jan 1 2023

    land cost 200,000


    fv 300000

    sales retail 350,000


    cash 100,000
    note 250,000
    terms: 5 years
    % = 12% annually
    entries
    jan 1 2023 cash 100,000
    notes recei 250,000
    land 200,000
    gain 150,000
    dec. 31 2023
    accrued int 30,000
    interest i 30,000

    2024 balance of AiR in 2024 = 60,000


    AIR 30,000
    Interest I 30,000 balance of Interest Income in 2025 = 27,500 ( beacause na zero out na s

    nov 31 2025
    cash 337,500 250k + 60K + 27,500
    notes Rece 250,000 250,000 x 11% (kase each month is 1%)
    AIR 60,000
    Interest I 27,500

    Non interest bearing


    repayment 1.12//presPresent value market prevailing rate
    2023 50,000 0.8929, 44645 12%
    2024 50,000 0.7972, 39860
    2025 100,000 0.7118, 71180 pag walang given schedule of payment directly yung 250k multply sa 0.5
    2026 30,000 0.6355 19065
    2027 20,000 0.5674, 11348
    250,000 186098 total present value of note
    ginagawa lang kapag iba iba ang payment

    present value of an ordinary annuity


    1.10 // tatlong =, -1, /0.1

    JOURNAL ENTRY (noninterest bearing)


    cash 100,000 balance of unearned interest income
    notes rece 250,000 5,355
    land 200,000 10,140
    unearned i 63,902 250k - 186, 098 28,820
    gain on sal 86,098 -63,902
    19,587
    2023
    unearned i5, 355 (50k - 44, 645)
    interest i 5,355
    ( beacause na zero out na sya by the year 2025)

    tly yung 250k multply sa 0.5674

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