Interest rateinterest rateinterest rateinterest rateChapter 14 Homework Problems1. Breakit Corporation issued a non-interest bearing note in 2011 with a face value of $100,000. What are the proceeds of the note if the market rate is 5% compounding annually and matures in 3 years?$86,3802. Johnson’s Department Store wants to raise $2,100,000 by issuing a five year, non-interest bearing note when the market rate is 8% compounded semi-annually. What is the face value of the note? $3,108,420 3. On January 1, 2008, Taylor Corporation purchased new equipment by signing a $600,000, 12-year noninterest-bearing note. The market rate of interest is 8% and interest is compounded semiannually. What will be the proceeds obtained when signing this note?$234,060.4. How many payments will Taylor make on the note aboveOne5. How much will Taylor pay when the note matures in 12 years?$600,0006. You are the Chief Accountant for the Yerr Company. Your company signs a $300,000 note requiring 36 monthly payments of $9,964.29 of principal and interest with an annual interest rate of 12%. When the first monthly payment is made, what is the entry to record the payment? INTEREST EXPENSE $3,000.00 NOTES PAYABLE $6,964.29CASH $9,964.29.Use the following partial amortization schedule to answer Questions 7 thru 11:Date Payment Interest Expense Discount Carrying Value1/1/2012 $7,056.85 $92,943.157/1/2012 $3,000 $3,253.01 $6,803.84 $93,196.161/1/2013 $3,000 $3,261.87 $6,541.97 $93,458.037. What type of note is depicted in the schedule above?Periodic payment and lump-sum8. What is the note’s face rate of interest?6%9. What is the note’s annual effective interest rate?7%10. What was the amount borrowed (debit entry to cash recorded by the borrower)?$92,943.1511. True or False:. The note was issued at a premium.No the note was issued at a discount, therefore the market rate was greater than the face rate.Countryside Hospital, Inc. expanded their facility by issuing a $125,000, 5% periodic installment note,requiring 20 annual payments of principal and interest. . 12. Countryside Hospital’s annual payment is:$10,030.13 What is the amount of INTEREST EXPENSE associated with Countryside’s SECOND PAYMENT?$6,06114. Parsons Capital, Inc. purchased equipment with a fair value of $600,000 on a 6 percent note. The noterequires five end-of-year payments of $142,438. What would be the carrying value of the note immediately after the second payment? $380,738Present Value of $1:Interest rate1% 4% 5% 8% 10% 12%# of periods2 .9803 .9246 .9070 .8573 .8264 .79723 .9706 .8890 .8638 .7938 .7513 .711810 .9053 .6756 .6139 .4632 .3855 .322012 .8874 .6246 .5568 .3971 .3186 .256720 .8195 .4564 .3769 .2145 .1486 .103724 .7876 .3901 .3101 .1577 .1015 .065936 .6989 .2437 .1727 .0626 .0323 .0169Future Value of $1:interest rate1% 4% 5% 8% 10% 12%# of periods2 1.0201 1.0816 1.1025 1.1664 1.2100 1.25443 1.0303 1.1249 1.1576 1.2597 1.3310 1.404910 1.1046 1.4802 1.6289 2.1589 2.5937 3.105812 1.1268 1.6010 1.7959 2.5182 3.1384 3.896020 1.2202 2.1911 2.6533 4.6610 6.7275 9.646324 1.2697 2.5633 3.2251 6.3412 9.8497 15.178636 1.4308 4.1039 5.7918 15.9682 30.9127 59.1356Present Value of an annuity of $1:interest rate1% 4% 5% 8% 10% 12%# of periods2 1.9704 1.8861 1.8594 1.7833 1.7355 1.69013 2.9410 2.7751 2.7232 2.5771 2.4869 2.401810 9.4713 8.1109 7.7217 6.7101 6.1446 5.650212 11.2551 9.3851 8.8633 7.5361 6.8137 6.194420 18.0456 13.5903 12.4622 9.8181 8.5136 7.469424 21.2434 15.2470 13.7986 10.5288 8.9847 7.784336 30.1075 18.9083 16.5469 11.7172 9.6765 8.1924Future Value of an annuity of $1:interest rate1% 4% 5% 8% 10% 12%# of periods2 2.0100 2.0400 2.0500 2.0800 2.100 2.12003 3.0301 3.1216 3.1525 3.2464 3.3100 3.374410 10.4622 12.0061 12.5779 14.4866 15.9374 17.548712 12.6825 15.0258 15.9171 18.9771 21.3843 24.133120 22.0190 29.7781 33.0660 45.7620 57.2750 72.052424 26.9735 39.0826 44.5020 66.7648 88.4973 118.155236 43.0769 77.5983 95.8363 187.1021 299.1268