An Installment Note Payable for a Principal Amount of $94,000

question 46

Multiple Choice

An installment note payable for a principal amount of $94,000 at 6% interest requires Lawson Company to repay the principal and interest in equal annual payments of $22,315 beginning December 31, of the first year, for each of the next five years. After the final payment, the carrying amount on the note will be

• A) $1,263
• B) $21,053
• C) $22,315
• D) $0

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Definitions:

First Develop

The initial phase of creating or establishing something, typically referring to the early stages of economic, industrial, or technological development.

Fast-Second Strategy

A business strategy where a company quickly follows pioneers into a new market or technology with the aim to surpass them.

Average Total Cost

The total cost of production (fixed plus variable costs) divided by the total quantity produced.

Legal Protection

Measures and regulations implemented by governments or organizations to safeguard the rights and properties of individuals, companies, or other entities.