Fun Land Corp. issued a 5-year, 0 interest bearing note with a $1,000,000 face value to Lightning Inc. for $1,000,000 cash. Fun Land also gave Lightning the right to use a parcel of land for equipment storage for 5 years. Interest rates for notes of this type were 8% at issue. Required Prepare the journal entries to record the issuance of the note by (1) Fun Land and (2) Lightning.
Fun Land Corp. issued a 5-year, 0 interest bearing note with a $1,000,000 face value to Lightning Inc. for $1,000,000 cash. Fun Land also gave Lightning the right to use a parcel of land for equipment storage for 5 years. Interest rates for notes of this type were 8% at issue. Required Prepare the journal entries to record the issuance of the note by (1) Fun Land and (2) Lightning.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Fun Land Corp. issued a 5-year, 0
interest bearing note with a $1,000,000
face value to Lightning Inc. for
$1,000,000 cash. Fun Land also gave
Lightning the right to use a parcel of
land for equipment storage for 5
years. Interest rates for notes of this
type were 8% at issue.
Required
Prepare the journal entries to record
the issuance of the note by (1) Fun
Land and (2) Lightning.
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