On january 1, 2016, cobb co. received, for the sale of a parcel of land, a ten-year note receivable having a face amount of $2,000,000 and a stated interest rate of 8% payable annually each december 31. the market rate of interest for this type of note is 10%. present value factors are as follows: at 8% at 10% present value of 1 for 10 periods 0.46319 0.38554 present value of an ordinary annuity of 1 for 10 periods 6.71008 6.14457 the amount to record as proceeds for the sale of the land is: a) $2,000,000 b) $1,960,200 c) $1,840,000 d) $1,754,211 e) none of the above

d) $1,754,211

Explanation:

The computation of the proceeds for the sale of the land is shown below:

= Interest expense × PVIFA for 10 years at 10% + Face value × PVIF for 10 years at 10%

= $160,000 × 6.14457 + $2,000,000 × 0.38554

= $983,131.20 + $771,080

= $1,754,211

The interest expense would be

= $2,000,000 × 8%

= $160,000

Simply we multiply the interest expense and face value with its present value interest annuity factor and present value interest factor so that the accurate amount can come.

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

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