On May 1,2014,SBC INC

question 39

Multiple Choice

On May 1,2014,SBC INC.buys a photocopier listed for $2,600.The office supply store agrees to accept a $800 down payment and a $2,100,three-year note payable at $798 per year including interest at 7%.The company's banker has suggested that an appropriate market rate is 11% per annum for loans that mature in one year or less and 14% for loans with longer maturities.At what amount will the photocopier be recorded at in the accounting records?

• A)$1,950
• B)$2,100
• C)$2,600
• D)$2,653

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Definitions:

Purchases

Transactions where buyers acquire goods or services from sellers in exchange for money or other compensation.

Share Of Wallet

The proportion of a customer's total spending that is captured by a business, indicating the customer's loyalty and the effectiveness of the company's marketing.

Customer Loyalty

The likelihood of previous customers to continue purchasing from a specific retailer or brand over time.

Purchases

The act of buying goods or services, an exchange of money for ownership or use.