A Company Purchased Equipment by Issuing a $200,000,one-Year,8% Note Payable

question 253

Multiple Choice

A company purchased equipment by issuing a $200,000,one-year,8% note payable.The transaction would be recorded in the accounting records with a credit to Notes Payable for:

• A)$200,000.
• B)$216,000.
• C)$184,000.
• D)$208,000.

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Definitions:

Ordinary Annuity

A financial product resulting in a stream of payments to the holder at regular intervals over a specified period of time, typically at the end of each period.

Deferred Annuity

An insurance product that delays income payments until the investor elects to receive them, typically at retirement.

Ordinary Annuity

A sequence of identical payments scheduled at consistent intervals where the interest accumulates after each cycle.

Deferred Annuity

A financial agreement which postpones the disbursement of income, periodic payments, or a one-time amount until chosen by the investor to be received.