A company decides to purchase a new delivery vehicle. The cost, in dollars, is $104,500. They takes out a 5-year "note" to pay for the vehicle, with 4% interest due at the beginning of each year. If I were to journalize this entry, would it be debit to equipment, and credit to accounts receivable for 104,500/5 + 0.04*104500? Or is it credited to something else?

A company decides to purchase a new delivery vehicle. The cost, in dollars, is $104,500. They takes out a 5-year "note" to pay for the vehicle, with 4% interest due at the beginning of each year. If I were to journalize this entry, would it be debit to equipment, and credit to accounts receivable for 104,500/5 + 0.04*104500? Or is it credited to something else?

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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