Given answer Accounting question Candy Company borrowed $16,000 on a 7-month, 9% note fromGopher State Bank to open their business, MK's Coffee House.The money was borrowed on June 1, 2017, and the note maturesJanuary 1, 2018.Determine the cash that Candy Company must pay on January1, 2018.

Compute the interest.Interest = Principal x Interest rate x PeriodInterest = 16,000 x 9% x…

Answered: Candy Company borrowed $16,000 on a…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...

See similar textbooks

Similar questions

On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.
A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest Expense
On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan. Refer to RE6-10. On December 31, Jordan Inc. received 50,000 on assigned accounts. Prepare Jordans journal entries to record the cash receipt and the payment to McLaughlin.
Arvan Patel is a customer of Banks Hardware Store. For Mr. Patels latest purchase on January 1, 2018, Banks Hardware issues a note with a principal amount of $480,000, 13% annual interest rate, and a 24-month maturity date on December 31, 2019. Record the journal entries for Banks Hardware Store for the following transactions. A. Note issuance B. Subsequent interest entry on December 31, 2018 C. Honored note entry at maturity on December 31, 2019.
On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank. The note has a face value of 15,000 and a maturity value (principal plus interest) of 15,400. The discount is calculated to be 385, and the accrued interest income is 100. The recourse liability is estimated to be 1,000. Prepare the journal entry of Phillips to record the sale of the note receivable.
On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10% interest rate. Each annual payment is in the amount of $39,569 and payment is due each Dec. 31. What is the journal entry on Jan. 1 to record the cash received and on Dec. 31 to record the annual payment? (You will need to prepare the first row in the amortization table to determine the amounts.)
Rain T-Shirts issued a $440,600 note on January 1, 2018 to a customer, Larry Potts, in exchange for merchandise. The merchandise had a cost to Rain T-Shirts of $220,300. The terms of the note are 24-month maturity date on December 31, 2019 at a 4.5% annual interest rate. Larry Potts does not pay on his account and dishonors the note. Record journal entries for Rain T-Shirts for the following transactions. A. Initial sale on January 1, 2018 B. Dishonored note entry on January 1, 2020, assuming interest has not been recognized before note maturity
Selkirk Company obtained a $16,000 note receivable from a customer on January 1, 2024. The note, along with interest at 12%, is due on July 1, 2024. On February 28, 2024, Selkirk discounted the note at Unionville Bank. The bank’s discount rate is 15%. Required: Prepare the journal entries required on February 28, 2024, to accrue interest and to record the discounting for Selkirk. Assume that the discounting is accounted for as a sale.
THREE FLAGS Co. borrowed $100,000 from the Bull Run Bank on September 1, 2018. The note earns interest at a rate of 12% and matures in six months on February 28, 2019. THREE FLAGS is supposed to pay off BOTH principal and interests on February 28, 2019. Both THREE FLAGS Co. and Bull Run Bank prepares their financial statements on December 31. Please provide Journal entries for THREE FLAGS Co. on the following dates: 9/1/2018 12/31/2018 2/28/2019 Please provide Journal entries for Bull Run Bank on the following dates: 9/1/2018 12/31/2018 2/28/2019
Vinubhai
Keesha Co. borrows $200,000 cash on November 1, 2018, by signing a 90-day, 9% note with a face value of $200,000 1. On what date does this note mature? 2. & 3. What is the amount of interest expense in 2018 and 2019 from this note? 4. Prepare journal entries to record (a) issuance of the note, (b) accrual of interest at the end of 2018, and (c) payment of the note at maturity. (Assume no reversing entries are made.) Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Req 4 On what date does this note mature? On what date does this note mature?
Selkirk Company obtained a $15,000 note receivable from a customer on January 1, 2018. The note, along withinterest at 10%, is due on July 1, 2018. On February 28, 2018, Selkirk discounted the note at Unionville Bank. Thebank’s discount rate is 12%.Required:Prepare the journal entries required on February 28, 2018, to accrue interest and to record the discounting (roundall calculations to the nearest dollar) for Selkirk. Assume that the discounting is accounted for as a sale.

SEE MORE QUESTIONS

Recommended textbooks for you

Principles of Accounting Volume 1

Accounting

ISBN:

9781947172685

Author:

OpenStax

Publisher:

OpenStax College

College Accounting, Chapters 1-27

Accounting

ISBN:

9781337794756

Author:

HEINTZ, James A.

Publisher:

Cengage Learning,

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:

Cengage Learning

Principles of Accounting Volume 1

Accounting

ISBN:

9781947172685

Author:

OpenStax

Publisher:

OpenStax College

College Accounting, Chapters 1-27

Accounting

ISBN:

9781337794756

Author:

HEINTZ, James A.

Publisher:

Cengage Learning,

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:

Cengage Learning

Financial Accounting: The Impact on Decision Make…

Accounting

ISBN:

9781305654174

Author:

Gary A. Porter, Curtis L. Norton

Publisher:

Cengage Learning

Financial Accounting

Accounting

ISBN:

9781305088436

Author:

Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS

Candy Company borrowed $16,000 on a 7-month, 9% note from Gopher State Bank to open their business, MK's Coffee House. The money was borrowed on June 1, 2017, and the note matures January 1, 2018. Determine the cash that Candy Company must pay on January 1, 2018.