Alden Trucking Company Is Replacing Part of Its Fleet of Trucks

question 91

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.
- After the first payment was made,the note payable liability on December 31,2019 is closest to:

• A)$32,908,000.
• B)$31,698,800.
• C)$40,000,000.
• D)$27,908,000.

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Definitions:

Correlation

A statistical measure that describes the size and direction of a relationship between two or more variables.

Forms of Words

Variations of a word that indicate different meanings, functions, or grammatical categories, such as tense or number.

Prototype Theory

A theory in cognitive science that suggests concepts or categorical judgments are based on comparisons to a typical or average member of a category (the prototype).

Mental Image

A representation in a person's mind of the physical world outside of one's immediate perception.