ACC 210 Lecture 7: Chapter 7 + 8 Lecture Notes
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17 Aug 2018
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Exercise 11-1 Payback Method [LO11-1]
The management of Unter Corporation, an architectural designfirm, is considering an investment with the following cashflows: |
Year | Investment | CashInflow |
1 | $60,000 | $2,000 |
2 | $4,000 | $4,000 |
3 | $8,000 | |
4 | $9,000 | |
5 | $12,000 | |
6 | $10,000 | |
7 | $8,000 | |
8 | $5,000 | |
9 | $4,000 | |
10 | $4,000 | |
Required: | |
1. | Determine the payback period of the investment. (Roundyour answer to 1 decimal place. |
Exercise 8-10
Sunland Company has the following transactions related to notesreceivable during the last 2 months of the year. The company doesnot make entries to accrue interest except at December 31. (Omitcost of goods sold entries.)
Nov. 1 | Loaned $59,400 cash to C. Bohr on a 12-month, 7% note. | |
Dec. 11 | Sold goods to K. R. Pine, Inc., receiving a $1,800, 90-day, 9%note. | |
Dec. 16 | Received a $16,800, 180-day, 11% note to settle an open accountfrom A. Murdock. | |
Dec. 31 | Accrued interest revenue on all notes receivable. |
Journalize the transactions for Sunland Company (Creditaccount titles are automatically indented when amount is entered.Do not indent manually. Record journal entries in the orderpresented in the problem.)