On December 30, 2007, Cey, Inc On Cey's December 31, 2007 Balance Sheet, the Net Note

Multiple Choice

On December 30, 2007, Cey, Inc.purchased a machine from Frank Corp.in exchange for a noninterest-bearing note requiring eight payments of $50,000.The first payment was made on December 30, 2007, and the others are due annually on December 30.At date of issuance, the prevailing rate of interest for this type of note was 11%.Present value factors are as follows: $\begin{array}{lll}& \text { Present Value of Ordinary }& \text {Present Value of }\\ \text {Period }& \text { Annuity of 1 at 11 \%}& \text {Annuity Due of 1 at 11 \% }\\7 & 4.712 & 5.231 \\8 & 5.146 & 5.712\end{array}$ On Cey's December 31, 2007 balance sheet, the net note payable to Frank is

A) $235,600.
B) $257,300.
C) $261,775.
D) $285,600.