Entries for Installment Note TransactionsOn January 1, Year 1, Wedekind Company issued a $22,000, 4-year, 12% installment note to Shannon Bank. The note requires annual payments of $7,243, beginning on December 31, Year 1.Journalize the entries to record the following:Year 1Jan. 1Issued the note for cash at its face amount.Dec. 31 Paid the annual payment on the note, which consisted of interest of $2,640 andprincipal of $4,603.Year 4Dec. 31 Paid the annual payment on the note, including $776 of interest. The remainderof the payment reduced the principal balance on the note.Issued the note for cash at its face amount. If an amount box does not require an entry, leave it blank.88Year 1, Jan. 1Paid the annual payment on the note, which consisted of interest of $2,640 and principal of $4,603. If an amount box does not require an entry, leave it blank.Year 1, Dec. 31Paid the annual payment on the note, including $776 of interest. The remainder of the payment reduced the principal balance on the note. If an amount box does not reguire an entry, leave it blank.Year 4, Dec. 3100

1. Notes Payable - Notes is the amount borrowed by the company from bank or financial institution…

Answered: Entries for Installment Note…

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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business issued a 45-day, 4% note for $240,000 to a creditor on account. Journalize the entries to record (a) the issuance of the note on January 1 and (b) the payment of the note at maturity, including interest. Assume a 360-day year. Refer to the Chart of Accounts for exact wording of account titles. CHART OF ACCOUNTS General Ledger ASSETS 110 Cash 111 Accounts Receivable 112 Interest Receivable 113 Notes Receivable 115 Merchandise Inventory 116 Supplies 118 Prepaid Insurance 120 Land 123 Building 124 Accumulated Depreciation-Building 125 Office Equipment 126 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 213 Interest Payable 214 Notes Payable 215 Salaries Payable 216 Social Security Tax Payable 217 Medicare Tax Payable 218 Employees Federal Income Tax Payable 219 Employees State Income Tax Payable 221 Retirement Savings Deductions Payable 224 Federal Unemployment Tax…
Entries for Installment Note Transactions On the first day of the fiscal year, Shiller Company borrowed $69,000 by giving a seven-year, 9% installment note to Soros Bank. The note requires annual payments of $13,885, with the first payment occurring on the last day of the fiscal year. The first payment consists of interest of $6,210 and principal repayment of $7,675. Journalize the entries to record the following: a1. Issued the installment note for cash on the first day of the fiscal year. If an amount box does not require an entry, leave it blank. - Select - - Select - - Select - - Select - a2. Paid the first annual payment on the note. If an amount box does not require an entry, leave it blank. - Select - - Select - - Select - - Select - - Select - - Select - b. How would the notes payable be reported on the balance sheet at the end of the fiscal year? Select
Martinez Co. borrowed $62,310 on March 1 of the current year by signing a 60-day, 8%, interest-bearing note. Assuming a 360-day year, when the note is paid on April 30, the entry to record the payment should include a a.debit to Interest Payable for $831. b.debit to Interest Expense for $831. c.credit to Cash for $62,310. d.credit to Cash for $67,295.
Entries for Notes Receivable Valley Designs issued a 90-day, 6% note for $48,000, dated April 17, to Bork Furniture Company on account. Assume 360 days in a year when computing the interest. a. Determine the due date of the note. b. Determine the maturity value of the note.$ c. Journalize the entry to record the receipt of the note by Bork Furniture. If an amount box does not require an entry, leave it blank. 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.
Preparing Entries and Interest Schedule for Long-Term Note Receivable; Effective Interest Method On January 1 of Year 1, Stealth Company sold a machine (classified as inventory) that had a list price of $21,600. The customer paid $3,600 cash and signed a three-year, $18,000 note that specified a stated rate of 3%. Annual interest on the full amount of the principal is payable each December 31. The principal is payable on December 31, three years later. The market rate for a note of this risk is 10%. Required a. Compute the present value of this note. b. Prepare an effective interest schedule for this note. c. Prepare entries required by Stealth for this note on January 1 of Year 1, and December 31 of Year 1, Year 2, and Year 3. • Note: Round answers to the nearest whole dollar. a. Present value of note: $ 25,301 b. Date Jan. 1. Year 1 Dec. 31, Year 1 $ Dec. 31, Year 2 Dec. 31, Year 3 Total S Cash (Stated Interest) 0x S 0x 05 x Interest Revenue (Market Interest) Discount on N.R.…
Keesha Company borrows $115,000 cash on November 1 of the current year by signing a 180-day, 11%, $115,000 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. 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? (Assume that February has 28 days.) On what date does this note mature?
Keesha Co. borrows $100,000 cash on November 1 of the current year by signing a 150-day, 10%, $100,000 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. 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? (Assume that February has 28 days.) On what date does this note mature?
Proceeds from Notes PayableOn May 15, Maynard Co. borrowed cash from Texas Bank by issuing a 120-day note with a face amount of $63,600. Assume a 360-day year.Required:a. Determine the proceeds of the note, assuming the note carries an interest rate of 9%.$b. Determine the proceeds of the note, assuming the note is discounted at 9%.$
On the first day of the fiscal year, a company issues $89,000, 6%, five-year installment notes that have annual payments of $21,128. The first note payment consists of $5,340 of interest and $15,788 of principal repayment. a. Journalize the entry to record the issuance of the installment notes. b. Journalize the first annual note payment
Journalizing Installment Notes On the first day of the fiscal year, a company issues $39,000, 10%, four-year installment notes that have annual payments of $12,303. The first note payment consists of $3,900 of interest and $8,403 of principal repayment. a. Journalize the entry to record the issuance of the installment notes. If an amount box does not require an entry, leave it blank. - Select - - Select - - Select - - Select - b. Journalize the first annual note payment. If an amount box does not require an entry, leave it blank. - Select - - Select - - Select - - Select - - Select - - Select -
On January 1, 20Y2, Hebron Company issued a $71,000, 4-year, 11% installment note to Ventsam Bank. The note requires annual payments of $22,885, beginning on December 31, 2012. Journalize the entries to record the following: 20Y2 Jan. 1 Issued the note for cash at its face amount. Dec. 31 Paid the annual payment on the note, which consisted of interest of $7,810 and principal of $15,075. 20Y5 Dec. 31 Paid the annual payment on the note, including $2,268 of interest. The remainder of the payment reduced the principal balance on the note. Issued the note for cash at its face amount. If an amount box does not require an entry, leave it blank. 20Y2 Jan. 1 Paid the annual payment on the note, which consisted of interest of $7,810 and principal of $15,075. If an amount box does not require an entry, leave it blank. 20Y2 Dec. 31 88 20Y5 Dec. 31 000 1 000 Paid the annual payment on the note, including interest of $2,268 of interest. The remainder of the payment reduced the principal balance on…
Lone Star Company received a 90-day, 6% note for $80,000, dated March 12 from a customer 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. c. Journalize the entry to record the receipt of the payment of the note at maturity. If an amount box does not require an entry, leave it blank. June 10

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