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Nerds "R" Us Corporation operates a retail computer store. To improve delivery services to customers, the company purchases four new trucks on April 1, 2020. The terms of acquisition for each truck are described below. 1. Truck #1 List price $15,000 Cash acquisition cost 13,900 2. Truck #2 List price $16,000 Acquisition cost Cash down payment 2,000 Face amount of zero-interest bearing note assumed 14,000 Note due date April 1, 2021 Normal interest rate for this borrowing 10% Incremental borrowing rate 8% 3. Truck #3 List price $16,000 Acquired in exchange for a computer system that Nerds "R" Us carries in inventory Cost of computer system in inventory 12,000 Normal selling price of computer system by Nerds "R" Us 15,200 Inventory system used by Nerds "R" Us Perpetual 4. Truck #4 List price $14,000 Acquired in exchange for common stock in Nerds "R" Us Corporation 1,000 shares Par value of common stock per share $10.00 Market value of common stock per share $13.00 Instructions: Prepare the appropriate journal entries for the above transactions for Nerds "R" Us Corporation. Debit Credit 1)Truck #1 13,900 Cash 13,900 2 " 2)Use the Excel Present Value formula. " 3) 4)

Nerds "R" Us Corporation operates a retail computer store. To improve delivery services to customers, the company purchases four new trucks on April 1, 2020. The terms of acquisition for each truck are described below. 1. Truck #1 List price $15,000 Cash acquisition cost 13,900 2. Truck #2 List price $16,000 Acquisition cost Cash down payment 2,000 Face amount of zero-interest bearing note assumed 14,000 Note due date April 1, 2021 Normal interest rate for this borrowing 10% Incremental borrowing rate 8% 3. Truck #3 List price $16,000 Acquired in exchange for a computer system that Nerds "R" Us carries in inventory Cost of computer system in inventory 12,000 Normal selling price of computer system by Nerds "R" Us 15,200 Inventory system used by Nerds "R" Us Perpetual 4. Truck #4 List price $14,000 Acquired in exchange for common stock in Nerds "R" Us Corporation 1,000 shares Par value of common stock per share $10.00 Market value of common stock per share $13.00 Instructions: Prepare the appropriate journal entries for the above transactions for Nerds "R" Us Corporation. Debit Credit 1)Truck #1 13,900 Cash 13,900 2 " 2)Use the Excel Present Value formula. " 3) 4)

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 12P: Hamlet Corporation purchases computer equipment at a price of 100,000 on January 1, 2019, paying...
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Nerds "R" Us Corporation operates a retail computer store. To improve delivery services to customers, the company purchases four new trucks on April 1, 2020. The terms of acquisition for each truck are described below. 1. Truck #1 List price $15,000 Cash acquisition cost 13,900

2. Truck #2 List price $16,000 Acquisition cost Cash down payment 2,000 Face amount of zero-interest bearing note assumed 14,000 Note due date April 1, 2021 Normal interest rate for this borrowing 10% Incremental borrowing rate 8%

3. Truck #3 List price $16,000 Acquired in exchange for a computer system that Nerds "R" Us carries in inventory Cost of computer system in inventory 12,000 Normal selling price of computer system by Nerds "R" Us 15,200 Inventory system used by Nerds "R" Us Perpetual

4. Truck #4 List price $14,000 Acquired in exchange for common stock in Nerds "R" Us Corporation 1,000 shares Par value of common stock per share $10.00 Market value of common stock per share $13.00

Instructions: Prepare the appropriate journal entries for the above transactions for Nerds "R" Us Corporation. Debit Credit

1)Truck #1 13,900 Cash 13,900 2 "

2)Use the Excel Present Value formula. "

3)

4)

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