A Company Borrows $40,000 and Issues a 3-Year, 10% Installment

question 157

True/False

A company borrows $40,000 and issues a 3-year, 10% installment note with interest payable annually. The factor for the present value of an annuity at 10% for 3 years is 2.4869. The factor for the present value of a single sum at 10% for 3 years is 0.7513. The amount of the annual payment is $12,000.

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Definitions:

Brake Chamber Pushrod

A brake chamber pushrod is a component of a pneumatic brake system, translating the force from the brake chamber to the brake mechanism to slow or stop the vehicle.

Compressor Compression Rings

Rings fitted around a compressor's piston to seal the combustion chamber against air leaks and maintain compression efficiency.

Inlet Restriction

A limitation or obstruction in the pathway through which fluids or air enters a system, affecting the system's performance.

Service Diaphragm

The rubber pancake on which service brake pressure acts to apply the brakes on an air brake–equipped vehicle.