On January 1, 2014, CS bought a machine on a $60,000, 14 percent, 3-year note payable. The note will be paid in six equal semi-annual payments starting June 30, 2014. CS should record the cost of the machine as:

Question

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The cost of the machine is the initial amount financed or the principal amount of the note payable, which is $60,000. Interest and payment schedules do not affect the initial recorded cost of the asset.

On January 1, 2014, CS Bought a Machine on a $60,000