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Polo Publishers purchased a multi-color offset press with terms of $75,000 down and a noninterest-bearing note requiring payment of $60,000 at the end of each year for two years. The interest rate implicit in the purchase contract is 11%. Polo would record the asset at:

Respuesta :

Answer:

$177,751.20

Explanation:

The computation of the recording value of the asset is shown below:

= Down payment + non interest-bearing note requiring payment  × PVA factor at 11% for 2 years

= $75,000 + $60,000 × 1.71252

= $75,000 + $102,751.20

= $177,751.20

Refer to the PVA table

By considering the PVA factor, the approximate amount could come.

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