On December 31, 2004, Roth Co. issued a $ 10,000 face value note payable to Wake Co. in exchange for services rendered to Roth. The note, made at usual trade terms, is due in nine months and bears interest, payable at maturity, at the annual rate of 3 %. The market interest rate is 8 %. The compound interest factor of $ 1 due in nine months at 8 % is. 944. At what amount should the note payable be reported in Roth ' s December 31, 2004 balance sheet?
Question 4
Rye Co. purchased a machine with a four-year estimated useful life and an estimated 10 % salvage value for $ 80,000 on January 1, 2003. In its income statement, what would Rye report as the depreciation expense for 2005 using the double declining balance method?
Question 5
Turtle Co. purchased equipment on January 2, 2002, for $ 50,000. The equipment had an estimated five-year service life. Turtle ' s policy for five-year assets is to use the 200 % double declining depreciation method for the first two years of the asset ' s life, and then switch to the straight-line depreciation method. In its December 31, 2004 balance sheet, what amount should Turtle report as accumulated depreciation for equipment?
Question 6
During 2005, Jase Co. incurred research and development costs of $ 136,000 in its laboratories relating to a patent that was granted on July 1, 2005. Costs of registering the patent equaled $ 34,000. The patent ' s legal life is 17 years, and its estimated economic life is 10 years. In its December 31, 2005, balance sheet, what amount should Jase report as patent, net of accumulated amortization?