The Carrying Value of a Long-Term Note Payable Is Computed

question 140

Multiple Choice

The carrying value of a long-term note payable is computed as:

• A)The future value of all remaining payments,using the market rate of interest.
• B)The face value of the long-term note less the total of all future interest payments.
• C)The present value of all remaining payments,discounted using the market rate of interest at the time of issuance.
• D)The present value of all remaining interest payments,discounted using the note's rate of interest.
• E)The face value of the long-term note plus the total of all future interest payments.

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Definitions:

LIFO

Last In, First Out, an inventory valuation method where the most recently produced or purchased items are the first to be expensed.

Dollar-Value LIFO

Dollar-Value LIFO method is an inventory costing method that uses the LIFO principle coupled with grouping inventory into pools based on dollar value instead of physical units.

Base Year Cost

The initial cost of an asset or investment, used as a reference point to measure the cost growth or performance over time.

Price Index

A statistical measure that shows changes in the price level of a basket of consumer goods and services over time, used to gauge inflation or deflation.