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Tuesday, February 15, 2011

Carrying value of a long-term not payable

Solution is available here for U$0.25

The carrying value of a long-term not payable
A. Is computed as the future value of all remaining future payment, using the market rate of interest.
B Is the face value of the long-term note less the total of all future interest payments
C. is computed as the present value of all remaining future payments, discounted using the market rate of interest at the time of issuance
D Is computed as the present value of all remaining interest payments, discounted using the note's rate of interest.
 E Decreases each time period the discount on the note is amortized. 

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