Fair Value Option.Ellison Company sells large store-rack systems and frequently accepts notes receivable from customers as payment. Ellison conducts a through credit check on its customers, and it charges a fairly low interest rate (1/2 of 1% payable monthly) on these notes. Ellison has elected to use the fair value option for one of these notes and has the following data related to the carrying and fair value for its note
InstructionsPrepare the journal entry at December 31 (Ellison's year-end) for 2014 and 2015, to record the fair value option for these notes.

Question

Fair Value Option.Ellison Company sells large store-rack systems and frequently accepts notes receivable from customers as payment. Ellison conducts a through credit check on its customers, and it charges a fairly low interest rate (1/2 of 1% payable monthly) on these notes. Ellison has elected to use the fair value option for one of these notes and has the following data related to the carrying and fair value for its note  
InstructionsPrepare the journal entry at December 31 (Ellison's year-end) for 2014 and 2015, to record the fair value option for these notes.

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The Answer of Fair Value Option.Ellison Company sells large store-rack systems and frequently accepts notes receivable from customers as payment. Ellison conducts a through credit check on its customers, and it charges a fairly low interest rate (1/2 of 1% payable monthly) on these notes. Ellison has elected to use the fair value option for one of these notes and has the following data related to the carrying and fair value for its note  
InstructionsPrepare the journal entry at December 31 (Ellison's year-end) for 2014 and 2015, to record the fair value option for these notes.