ABC Accepts a $400,000, 9%, Two-Year Note from DEF on July

question 22

Essay

ABC accepts a $400,000, 9%, two-year note from DEF on July 1, 2019, and lends cash to DEF. This note matures on June 30, 2021, and requires annual installment payments each June 30 until maturity. The market rate of interest on the date of issue was 9%. Calculate the required annual payment and complete the amortization table for this note receivable, and then complete all necessary journal entries for 2019, 2020, and 2021. ABC is a calendar-year company that files financial statements annually.

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Definitions:

Diffusion of Responsibility

A socio-psychological phenomenon whereby a person is less likely to take responsibility for action or inaction when others are present.

Bystander Intervention

The act of someone stepping in to help or intervene when they see another person in trouble, influenced by various psychological and situational factors.

Emergency Response

The organization and deployment of services and resources in reaction to emergencies to minimize their adverse effects.

Bodily Harm

Physical injury, pain, disease, or impairment inflicted on a person's body.