On August 1,a $30,000,6%,3-Year Installment Note Payable Is Issued by a Company.The

question 124

Multiple Choice

On August 1,a $30,000,6%,3-year installment note payable is issued by a company.The note requires equal payments of principal plus accrued interest be paid each year on July 31.The present value of an annuity factor for 3 years at 6% is 2.6730.The present value of a single sum factor for 3 years at 6% is 0.8396.The payment each July 31 will be:

• A)$10,000.00.
• B)$11,223.34.
• C)$80,190,00.
• D)$10,400.00.
• E)$1,223.34.

---

Definitions:

Merchandise

Goods that are purchased, held, and resold by a business in the normal course of its operations.

Discount Offered

A reduction applied to the regular price of goods or services as a form of promotion or negotiation.

Sales Discount

A reduction in the price of goods or services offered to customers, usually as an incentive for prompt payment.

Credit Sales

Credit sales are transactions where the customer purchases goods or services with the agreement to pay at a later date, typically invoiced by the seller.