Ask Question
BusinessBusiness
7 January, 06:53

Crane Company borrowed $750000 from BankTwo on January 1, 2019 in order to expand its mining capabilities. The 5-year note required annual payments of $195327 and carried an annual interest rate of 9.5%. What is the amount of expense Crane must recognize on its 2020 income statement

+2
Answers (1)
  1. 7 January, 07:13
    0
    The interest expense of $59,463 must be recognize on its 2020 income statement.

    Explanation:

    With the given data make an amortization schedule

    Hint : First determine the Future Value of the 5-year note

    PV = $750,000

    N = 5

    Pmt = - $195,327

    P/yr = 1

    i = 9.5%

    Fv = 0

    Input the elements in a Financial Calculator.

    2019

    interest expense = $71,250

    2020

    interest expense = $59,463

    Conclusion:

    The interest expense of $59,463 must be recognize on its 2020 income statement.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Crane Company borrowed $750000 from BankTwo on January 1, 2019 in order to expand its mining capabilities. The 5-year note required annual ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Suppose a state passes a minimum wage law that increases the minimum wage from $5/hour to $20/hour. The equilibrium wage prior to the minimum wage hike was $10/hour.
Answers (1)
Bonita Wolfe purchased a media system for her home which included a television for $1,398.77, a computer for $895.60, surround sound for $1,560.99, and a DVD player for $231.15. She lives in Florida and pays a 7% sales tax.
Answers (1)
In 2016, Philadelphia imposed a tax of 1.5 cents per ounce on sweetened beverages, and PepsiCo indicated that its sales in Philadelphia fell by 40 percent after the tax took effect.
Answers (1)
According to the article, why is it that once witnesses state information as a fact or identify a person as the perpetrator, the witnesses are usually unwilling or unable to change their understanding of the situation, even after they are provided
Answers (1)
Freda's Florist reported the following before-tax income statement items for the year ended December 31, 2016: Operating income $250,000 Income on discontinued operations $70,000 All income statement items are subject to a 40% income tax rate.
Answers (1)
New Questions in Business
Which of the following statements about materials is false? Select one: a. The use of direct materials gives rise to a debit to Work-in-Process Inventory. b. Acquisitions of materials are normally charged to the Purchases account. c.
Answers (1)
Hannah Roberts owns and operates Hannah's Pool Service Company. On January 1, Hannah Roberts, Capital had a balance of $309,170. During the year, Hannah invested an additional $22,040 and withdrew $39,010.
Answers (1)
Q: Lisa sells 10 bottles of homemade ketchup for $10 each. The cost of the ingredients, the bottles, and the labels was $70. In addition, it took her 2 hours to make the ketchup and to do so she took time off from a job that paid her $10 per hour.
Answers (1)
The following information was available to the accountant of Scarlet Co. when preparing the monthly bank reconciliation: Cash balance per bank statement $ 1,115 Cash balance per books (prior to reconciliation) 842 Outstanding check #643 642
Answers (1)
Your business plan is a
Answers (1)
Home » Business » Crane Company borrowed $750000 from BankTwo on January 1, 2019 in order to expand its mining capabilities. The 5-year note required annual payments of $195327 and carried an annual interest rate of 9.5%.
Sign Up Forgot Password?