Exhibit 14-16 Harry's Inc. Issued a Four-Year, $75,000, Non-Interest-Bearing Note to a to a Customer
Multiple Choice
Exhibit 14-16
Harry's Inc. issued a four-year, $75,000, non-interest-bearing note to a customer on January 1, 2016. Harry also agrees to sell inventory to the customer at reduced rates over a five-year period. Sales are to be evenly spread over the five-year period. Harry's incremental interest rate is 8%, and the present value of the note is $55,125.
-Refer to Exhibit 14-16.What is Harry's sales revenue connected with the note in 2018 ?
A) $4,974
B) $15,000
C) there is no sales revenue on a note payable
D) $3,975
Correct Answer:
Verified
Correct Answer:
Verified
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