Cypress Oil Company's December 31, 2013, balance sheet listed $645,000 of notes receivable and $16,000 of interest receivable included in current assets. The following notes make up the notes receivable balance:
The company records adjusting entries only at year-end. There were no other notes receivable outstanding during 2013.
Required:
1. Determine the rate used to discount the noninterest-bearing note.Discount rate %
2. Determine the explicit interest rate on Note 2. (Do not round intermediate calculations.)Interest rate %
3. What is the amount of interest revenue that appears in the company%u2019s 2013 income statement related to these notes? (Do not round intermediate calculations.)Interest revenue $