First Payment-January 1, 2019 600,000

add:Present Value-6 payments remaining (600,000*4.36) 2,616,000

Sales Revenue 3,216,000
Note Face Value 9,500,000
Less:Present Value-nine payments(500,000*6.25) 3,125,000
Unearned Interest Income 6,375,000

Note Receivable 9,500,000

Less:Uneanred Interest Income 6,375,000
Carrying Value-December31,2020 3,125,000
Note Receivable 4,000,000
Less:Present Value(4,000,000*.75) 3,000,000
Unearned Interest Income 1,000,000

Present Value-First Year 3,000,000

Interest Income at 10% 300,000 300,000

Present Value-Second Year 3,300,000

Interest Income at 10% 330,000 330,000

Present Value-Third Year 3,630,000

Interest Income at 10% 370,000 370,000
4,000,000 1,000,000
 Date Annual Collection
Note Receivale 6,000,000 Jan 1 2020
Less:Present Value (6,000,000*.75 4,500,000 Dec 31 2020
Unearned Interest Income 1,500,000 Dec 31 2021
Dec 31 2022
Dec 31 2023
Interest Income Principal Present value
4,500,000
450,000

-
Zeta Company 1,000,000 Short term calculated at face value

Principal 1,000,000
Cumulative Interest for 5 yrs (1,000,000*.03)*5 150,000
Maturity Value 1,150,000
Multiply:PV Factor 0.680
Note Present Value-Yola Company 782,000
Note Face Value 2,500,000 Date
Less:Present Value (500,000*3.99) 1,995,000 Dec 31 2020
Unearned Interest Income 505,000 Dec 31 2021
Dec 31 2022
Note Face Value 2,500,000
Less:Unearned Interest Income 505,000
Carrying Value- December 31,2020 1,995,000

Notes Receivable-December 31, 2021 2,000,000

Less:Unearned Interest income(505000-159600) 345,400
Carrying Amount-December 31, 2021 1,654,600
Annual Collection Interest Income Principal Present value
1,995,000
500,000 159,600 340,400 1,654,600
500,000 132,368 367,632 1,286,968
Note Face Value 5,000,000
Less:Present Value (500000*5.65) 2,825,000
Unearned Interest Income 2,175,000

Note Face Value 5,000,000

Less:Unearned Interest Income 2,175,000
Carrying Value- December 31,2020 2,825,000

Present Value-Sale Price 2,825,000

Less:Carrying amount 2,000,000
Gain on sale 825,000

Notes Receivable-December 31, 2021 4,500,000

Less:Unearned Interest income(2,175,000-339,000) 1,836,000
Carrying Amount-December 31, 2021 2,664,000
Date Annual Collection Interest Income Principal
Dec 31 2020
Dec 31 2021 339,000
Present value
2,825,000
Note Receivable 9,000,000
Less:Present Value (1,000,000*6.25) 6,250,000
Unearned Interest Income 2,750,000

Note Receivable 9,000,000

Less:Unearned Interest Income 2,750,000
Carrying Value- December 31,2020 6,250,000

Notes Receivable-December 31, 2021 8,000,000

Less:Unearned Interest income(2,750,000-500,000) 2,250,000
Carrying Amount-December 31, 2021 5,750,000
Date Annual Collection Interest Income Principal Present value
Dec 31 2020 6,250,000
Dec 31 2021 500,000
Note Receivable 1,000,000 Date
Less:Present Value (1,000,000*.712) 712,000 Dec 31 2020
Unearned Interest Income 288,000 Dec 31 2021
Dec 31 2022
Note Receivable 1,000,000
Less:Unearned Interest Income 288,000
Carrying Value- January 1,2020 712,000

Present Value of Note-Sale Price 712,000 712,000

Less:Carrying Value of Equipment 800,000 85,440
Gain or Loss on the sale of equipment - 88,000
797,440
Note Receivable 1,000,000 95,693
Less:Unearned Interest Income 202,560
Carrying Value- December 31,2020 797,440 106,867
288,000
Annual Collection Interest Income Principal Present value
85,440 712,000