Fold and Hold Corporation Purchased a Machine, Which Had a Current

question 63

Essay

Fold and Hold Corporation purchased a machine, which had a current cash equivalent cost of $38,971 on January 1, 2014. Fold and Hold paid cash of $10,000 and signed an interest-bearing note for the balance, payable in six equal annual installments on each December 31 beginning with December 31, 2014. The note specified a 10% interest rate on the unpaid balance.
Requirements:
A. Prepare the journal entry to record the purchase on January 1, 2014 (round to the nearest dollar).
B. Prepare the entry to record the first installment payment on December 31, 2014 (round to the nearest dollar). Assume that no adjusting entries have been made during the year.

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Definitions:

Memory Size

Indicates the total amount of data (typically in bytes) that a computer or device's memory can hold, affecting its ability to store and process information.

Matrix Limitation

Constraints or limitations within a matrix configuration, affecting its structure, processing capabilities, or how data is inputted or retrieved.

Parallel Rows

Lines or arrangements that are side-by-side and equidistant at all points, used in various contexts from agriculture to computing.

Memory Size

Refers to the capacity of a computer or device to store data and program instructions, typically measured in bytes.