Ex 7- Long-Term Note Payable a) What if the Einstein Corporation decided to raise capital (Cash) by issuing a Note instead of selling Stocks or Bonds. Journalize the entries for the following 1) Issued the $500,000 3 year 8% Note to the First National Bank on January 1, 202X Account Name Debit Credit 2) Entry made on each December 31 to accrue interest expense for that year. Account Name Debit Credit 3) Entry made to pay off the Note at the end of the 3 years, after the entry for the accrual of interest for the thi vear has been made Account Name Debit Credit :8-Installment
Ex 7- Long-Term Note Payable a) What if the Einstein Corporation decided to raise capital (Cash) by issuing a Note instead of selling Stocks or Bonds. Journalize the entries for the following 1) Issued the $500,000 3 year 8% Note to the First National Bank on January 1, 202X Account Name Debit Credit 2) Entry made on each December 31 to accrue interest expense for that year. Account Name Debit Credit 3) Entry made to pay off the Note at the end of the 3 years, after the entry for the accrual of interest for the thi vear has been made Account Name Debit Credit :8-Installment
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Ex 7- Long-Term Note Payable
a) What if the Einstein Corporation decided to raise capital (Cash) by issuing a Note instead of selling Stocks or
Bonds. Journalize the entries for the following:
1) Issued the $500,000 3 year 8% Note to the First National Bank on January 1, 202X
Account Name
Debit
Credit
2) Entry made on each December 31 to accrue interest expense for that year.
Account Name
Debit
Credit
3) Entry made to pay off the Note at the end of the 3 years, after the entry for the accrual of interest for the third
vear has been made
Account Name
Debit
Credit
Ex 8 - Installment Note Payable
a) What if the Einstein Corporation decided to sign a $500,000, 12%, 20 year Mortgage Note Payable to First
National Bank on January 1, 202X for the purchase of a new building. The Mortgage Note stipulates that $33,231 be
paid each 6 months for the next 20 years. Journalize the entries for the following:
1) Issued the $500,000 20 year 12% Note to the First National Bank on January 1, Year 1.
Account Name
Debit
Credit
2) Entry made on June 30, Year 1 for the 1st payment of $33,231. (Hint: What was the amount of the principal
owed for the past 6 months.)
Account Name
Debit
Credit
3) Entry made on December 31, Year 1 for the 2nd payment of $33,231. (Hint: What was the amount of the
principal owed for the past 6 months.)
Account Name
Debit
Credit
4) Entry made on June 30, Year 2 for the 3rd payment of $33,231. (Hint: What was the amount of the principal
owed for the past 6 months.)
Account Name
Debit
Credit
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