3. On January 1, Esly Company obtained a $125,000, 7-year 5% installment note from Farmers Bank. Thenote requires annual payments of $21,602, with the first payment occurring on the last day of the fiscal year.(a) Prepare an amortization schedule for Year 1 and Year 2DateJanuary 1carryingamountNote paymentInterestexpenseDecrease inNotes payable(b) Journalize the following entries:a. Issued the installment notes for cash on January 1.Dec 31carryingamount

Step 1:Notes Payable are reported under the non current liablities section of the Liabilities.Long…

Answered: 3. On January 1, Esly Company obtained…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

On January 1, the first day of the fiscal year, Shiller Company borrowed $120,000 by giving a seven-year, 9% installment note to Soros Bank. The note requires annual payments of $23,843, with the first payment occurring on the last day of the fiscal year. The first payment consists of interest of $10,800 and principal repayment of $13,043. Required: A. Journalize the entries to record the following transactions. Refer to the Chart of Accounts for exact wording of account titles. 1. Issued the installment note for cash on the first day of the fiscal year. 2. Paid the first annual payment on the note. B. Explain how the notes payable would be reported on the balance sheet at the end of the first year.
Keesha Company borrows $290,000 cash on December 1 of the current year by signing a 180-day, 8%, $290,000 note. 1. On what date does this note mature? 2. & 3. What is the amount of interest expense in the current year and the following year from this note? 4. Prepare journal entries to record (a) issuance of the note, (b) accrual of interest on December 31, and (c) payment of the note at maturity.
How do I find the carrying amout for each year?
Entries for Notes Receivable Spring Designs & Decorators issued a 120-day, 6% note for $42,000, dated April 13 to Jaffe Furniture Company on account. Assume a 360-day year when calculating interest. a. Determine the due date of the note. b. Determine the maturity value of the note. c1. Journalize the entry to record the receipt of the note by Jaffe Furniture. c2. Journalize the entry to record the receipt of payment of the note at maturity. If an amount box does not require an entry, leave it blank.
Entries for Installment Note Transactions On January 1, Year 1, Bryson Company obtained a $32,000, four-year, 11% installment note from Campbell Bank. The note requires annual payments of $10,314, beginning on December 31, Year 1. a. Prepare an amortization table for this installment note, similar to the one presented in Exhibit 4. Note: Round the computation of the interest expense to the nearest whole dollar. Enter all amounts as positive numbers. In Year 4, round the amount in the Decrease in Notes Payable column either up or down to ensure that the Carrying Amount zeroes out. Amortization of Installment Notes Year Interest Expense Ending (11% of January 1 December 31 January 1 Note Payment Decrease in December Note Carrying Carrying Carrying Amount (Cash Paid) Notes Payable 31 Amount) Amount Year 1 2$ $ Year 2 Year 3 Year 4 b. Journalize the entries for the issuance of the note and the four annual note payments. II
Spring Designs & Decorators issued a 180-day, 9% note for $88,400, dated April 13 to Jaffe Furniture Company on account. Required: A. Determine the due date of the note. B. Determine the maturity value of the note. Assume a 360-day year when calculating interest. C. Journalize the entries to record the following: (1) receipt of the note by Jaffe Furniture and (2) receipt of payment of the note at maturity. Refer to the Chart of Accounts for exact wording of account titles.
Prefix Supply Company received a 60-day, 5% note for $57,000 dated July 12 from a customer on account. Required: a. Determine the due date of the note. b. Determine the maturity value of the note. Assume a 360-day year. c. Journalize the entry to record the receipt of the payment of the note at maturity. Refer to the Chart of Accounts for exact wording of account titles. a. Determine the due date of the note. September 10 b. Determine the maturity value of the note. Assume a 360-day year. (Note: Round computations to the nearest whole dollar.) c. Journalize the entry to record the receipt of the payment of the note at maturity. Refer to the Chart of Accounts for exact wording of account titles.
Concord Company borrows $61,200 on July 1 from the bank by signing a $61,200, 10%, one-year note payable. (a) Prepare the journal entry to record the proceeds of the note.(b) Prepare the journal entry to record accrued interest at December 31, assuming adjusting entries are made only at the end of the year
On June 1, Davis Inc. issued an $68,700, 8%, 120-day note payable to Garcia Company Assume that the fiscal year of Garcia ends June 30. Using a 360-day year in your calculations, what is the amount of interest revenue recognized by Garcia in the following year? When required, round your answer to the nearest dollar. a.$916 b.$1,389 c.$5,496 d.$458
On November 1, Kotler Company accepted a 3-month note receivable as payment for services provided to Norman Company. The face value was $9,000, and it had a stated 6% annual rate of interest. Kotler Company made the required accrual on December 31. On February 1, the entry to record the collection of the note should include: Select one: a. A decrease to Interest Receivable for $135 b. An Increase to Interest Income for $45 c. A decrease to Notes Receivable for $8,135 d. An increase to Interest Income for $135
Entries for installment note transactionsOn January 1, Year 1, Bryson Company obtained a $147,750, four-year,7% installment note from Campbell Bank. The note requires annualpayments of $43,620, beginning on December 31, Year 1. a. Prepare an amortization table for this installment note, similar to theone presented in Exhibit 4.b. Journalize the entries for the issuance of the note and the four annual note payments.c. Describe how the annual note payment would be reported in the Year1 income statement.
On August 1, a $60,000, 7%, 3-year installment note payable is issued by a company. The note requires equal payments of principal plus accrued interest of $22,863.10. The entry to record the first payment on July 31 would include: a) Debit to Notes Payable of $22,863.10b) Debit to Interest Expense of $4,200.00.c) Debit to Cash of $22,863.10.d) Credit to Notes Payable of $22,863.10e) Credit to Cash $18,663.10

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