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Blue Spruce Inc. is a reliable, long-term customer of Swifty Ltd. Due to unexpected costs of...

Blue Spruce Inc. is a reliable, long-term customer of Swifty Ltd. Due to unexpected costs of rapid expansion, Blue Spruce was unable to pay its account balance when it became due on January 1, 2021. Swifty agreed to accept a $295,000 non-interest bearing note that would be payable on December 31, 2024. This type of financing would typically have an interest rate of 12%.

Click here to view the factor table PRESENT VALUE OF 1.
Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1.

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Use 1. PV.1 Tables, 2. a financial calculator, or 3. Excel functions to arrive at the amountto record the note receivable. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 58,971.)

Note receivable $Enter your answer in accordance to the question statement

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Prepare the journal entry to record this transaction for Swifty Ltd. on Jan 1, 2021. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 58,971. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation

Debit

Credit

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Partially correct answer iconYour answer is partially correct.

Prepare the journal entries for Swifty Ltd. on December 31, 2021 and on December 31, 2022, using the effective interest method. (Round answers to 0 decimal places, e.g. 58,971. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)

Date

Account Titles and Explanation

Debit

Credit

                                                                      December 31, 2021December 31, 2022

                                                                      December 31, 2021December 31, 2022

(To record interest)
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