The sаmple size is the mоst impоrtаnt principle оr fаctor in sampling.
Essаy Questiоn # 3 Stоck Islаnd Cоmpаny would like to purchase a corporate fishing boat. Stock Island pays $100,000 and signs a 4 year, 5%, $3 million Note Payable with the seller, Big Pine Corp., to purchase the boat on 4/1/2020. The note requires annual interest payments beginning on 4/1/2021 with the principal of the note due on 4/1/24. The boat has a market value of $3.1 million at 4/1/2020. Stock Island uses straight-line depreciation methods with $310,000 of depreciation recorded in the first year (i.e., 12 months) Requirements A) For Stock Island ONLY, prepare all appropriate journal entries for the year ended December 31, 2020, Stock Island's financial reporting year-end. Adjusting entries, as needed, are required. B) On 4/2/2021 (day after first interest payment/receipt and first full year of depreciation expense) Stock Island experiences dire financial (cash flow) difficulties related to an unexpected unfavorable lawsuit verdict. Stock Island and Big Pine agree on 4/2/2021 to settle the debt as follows: Stock island will transfer ownership of the fishing boat to Big Pine, Inc. The boat has a fair value (i.e., market value) of $2,790,000 on 4/2/2021. Big Pine, in recognition of receiving ownership to the boat, will cancel the original note payable. Record the settlement of this debt on 4/2/2021 for Stock Island ONLY