Anxious Company acquired three items of machinery. * On January 1, 2017, the entity purchased a...

Anxious Company acquired three items of machinery.

* On January 1, 2017, the entity purchased a machine for 500,000 down and four monthly installments of 1,250,000. The cash price of the machine was 4,700,000.

* On December 31, 2017, the entity purchased a machine in exchange for a noninterest bearing note requiring ten payments of 500,000.

The first payment was made on December 31, 2018, and the others are due annually on December 31.

The prevailing rate of interest for this type of note at date of issuance was 12%.

The present value of an ordinary annuity of 1 at 12% is 5.33 for nine periods and 5.65 for ten periods.

* On December 31, 2017, the entity acquired used machinery by issuing the seller a two-year, nonintereset bearing note for 3,000,000.

In recent borrowing, the entity has paid a 12% interest for this type of note.

The present value of 1 at 12% for 2 years is .80 and the present value of an ordinary annuity of 1 at 12% for 2 years is 1.69

Required:

Prepare journal entries for 2017, 2018 and 2019

Expert Solution

ekkarill92 answered 2 years ago

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