Described below are certain transactions of Pharoah Company for 2021: On May 10, the company purchased goods from Fox Company for $74,900, terms 2/10, n/30. Purchases and accounts payable are recorded at net amounts. The invoice was paid on May 18. On June 1, the company purchased equipment for $96,000 from Rao Company, paying $31,200 in cash and giving a one- year, 9% note for the balance. On September 30, the company discounted at 11% its $220,000, one-year zero-interest-bearing note at Virginia State Bank, receiving $198,000. 1. 2. 3.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Described below are certain transactions of Pharoah Company for 2021:
On May 10, the company purchased goods from Fox Company for $74,900, terms 2/10, n/30. Purchases and accounts
payable are recorded at net amounts. The invoice was paid on May 18.
1.
On June 1, the company purchased equipment for $96,000 from Rao Company, paying $31,200 in cash and giving a one-
year, 9% note for the balance.
2.
On September 30, the company discounted at 11% its $220,000, one-year zero-interest-bearing note at Virginia State
Bank, receiving $198,000.
3.
Transcribed Image Text:Described below are certain transactions of Pharoah Company for 2021: On May 10, the company purchased goods from Fox Company for $74,900, terms 2/10, n/30. Purchases and accounts payable are recorded at net amounts. The invoice was paid on May 18. 1. On June 1, the company purchased equipment for $96,000 from Rao Company, paying $31,200 in cash and giving a one- year, 9% note for the balance. 2. On September 30, the company discounted at 11% its $220,000, one-year zero-interest-bearing note at Virginia State Bank, receiving $198,000. 3.
Indicate the manner in which the above transactions should be reflected in the Current Liabilities section of Pharoah
Company's December 31, 2021 balance sheet.
Current Liabilities
2$
%24
Transcribed Image Text:Indicate the manner in which the above transactions should be reflected in the Current Liabilities section of Pharoah Company's December 31, 2021 balance sheet. Current Liabilities 2$ %24
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