Alden Trucking Company Is Replacing Part of Its Fleet of Trucks

question 61

Multiple Choice

Alden Trucking Company is replacing part of its fleet of trucks by purchasing them under a note agreement with Kenworthy on January 1,2019.Alden financed $37,908,000,and the note agreement will require $10 million in annual payments starting on December 31,2019 and continuing for a total of four more years (final payment December 31,2023) .Kenworthy will charge Alden Trucking Company the market interest rate of 10% compounded annually.
- The amount of principal that is paid at December 31,2019 is:

• A)$13,790,800.
• B)$6,209,200.
• C)$6,000,000.
• D)$10,000,000.

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