### InstructionsOn November 16, 2019, Clear Glass Company borrowed $20,000 from First American Bank by issuing a 90-day, non-interest-bearing note. The bank discounted this note at 14% and remitted the difference to Clear Glass.**Required:**1. Prepare the journal entries of Clear Glass to record the preceding information, the related calendar year-end adjusting entry, and payment of the note at maturity.2. Show how the preceding items would be reported on the December 31, 2019, balance sheet.3. Next Level: What is Clear Glass Company’s effective interest rate?### General Journal1. Prepare the necessary journal entries to record: - The issuance of the note on November 16, 2019. - The related adjustment on December 31, 2019. - Payment of the note on February 15, 2020. - Interest expense for 2020 on February 15, 2020.[General Journal Instructions]**General Journal Table**| Date | Account Title | Post Ref. | Debit | Credit ||------|---------------|-----------|-------|--------|| | | | | || | | | | || | | | | || | | | | || | | | | |### Balance Sheet2. Show how the preceding items would be reported on the December 31, 2019, balance sheet.[Balance Sheet Instructions]**Balance Sheet Table****CLEAR GLASS COMPANY**Partial Balance Sheet December 31, 2019| Current Liabilities: | | ||----------------------|---|---|| | | || | | |

Interest expense is the one which is paid on any kind of loan, bonds or securities.

Instructions General Journal X Balance Sheet On November 16, 2019, Clear Glass Company borrowed $20,000 from First American Bank by issuing a 90-day. 1. Prepare the necessary journal entries to record: 2. Show how the preceding items would be reported on the December 31, 2019, balance sheet. non-interest-bearing note. The bank discounted this note at 16% and remitted the difference to Clear Glass. 1. the issuance of the note on November 16. 2019 2. the related adjustment on December 31, 2019 Required: 3. payment of the note on February 15, 200 Balance Sheet instructions 1. Prepare the journal entries of Clear Glass to record the preceding information, the related calendar 4 interest expense 2020 on February 15. 2020 vear-end adiusting entry and payment of the note at maturity 2. Show how the preceding items would be reported on the December 31, 2019, balance sheet CLEAR GLASS COMPANY 3. Next Level what is Clear Glass Company's effective interest rate? Patial Balance Sheet General Jounal Instructions December 31. 2019 Current Liabilities: PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITUE POST, REF. DEBIT CREDIT

Instructions General Journal X Balance Sheet On November 16, 2019, Clear Glass Company borrowed $20,000 from First American Bank by issuing a 90-day. 1. Prepare the necessary journal entries to record: 2. Show how the preceding items would be reported on the December 31, 2019, balance sheet. non-interest-bearing note. The bank discounted this note at 16% and remitted the difference to Clear Glass. 1. the issuance of the note on November 16. 2019 2. the related adjustment on December 31, 2019 Required: 3. payment of the note on February 15, 200 Balance Sheet instructions 1. Prepare the journal entries of Clear Glass to record the preceding information, the related calendar 4 interest expense 2020 on February 15. 2020 vear-end adiusting entry and payment of the note at maturity 2. Show how the preceding items would be reported on the December 31, 2019, balance sheet CLEAR GLASS COMPANY 3. Next Level what is Clear Glass Company's effective interest rate? Patial Balance Sheet General Jounal Instructions December 31. 2019 Current Liabilities: PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITUE POST, REF. DEBIT CREDIT

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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L. How much interest income should be reported on December 31, 2020 with regards to the note from Company B? 2-2 Notes Receivables The trial balance for BLUE Corporation prepared at December 31, 2020 showed a balance of P4,000,000 for Notes Receivables broken as follows: Notes receivable from Company A Notes receivable from Company B 3,000,000 1,000,000 Total 4,000,000 Additional information: The notes receivable from Company A is a three-year non- interest bearing note, with face value of P3,000,000. The note was received in exchange for a piece of land sold by BLUE on May 1, 2020. The land was carried in the books at the date of sale at P2,600,000. The difference between the face amount of the note and the carrying value of the land was credited to gain on sale of land. The market interest rate for a note of this type is 10%. The notes receivable from Company B bears interest at 10%. The note was received from sale of goods in the normal course of business. The note is dated October…
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K. Company B on October 1, 2020? What is the carrying value of the note received from 2-2 Notes Receivables The trial balance for BLUE Corporation prepared at December 31, 2020 showed a balance of P4,000,000 for Notes Receivables broken as follows: Notes receivable from Company A Notes receivable from Company B 3,000,000 1,000,000 Total 4,000,000 Additional information: The notes receivable from Company A is a three-year non- interest bearing note, with face value of P3,000,000. The note was received in exchange for a piece of land sold by BLUE on May 1, 2020. The land was carried in the books at the date of sale at P2,600,000. The difference between the face amount of the note and the carrying value of the land was credited to gain on sale of land. The market interest rate for a note of this type is 10%. The notes receivable from Company B bears interest at 10%. The note was received from sale of goods in the normal course of business. The note is dated October 1, 2020 and matures on…
Required information Exercise 7-5 (Algo) Notes payable—discount basis LO 2 Skip to question [The following information applies to the questions displayed below.] On April 15, 2019, Powell Inc. obtained a six-month working capital loan from its bank. The face amount of the note signed by the treasurer was $255,400. The interest rate charged by the bank was 5.00%. The bank made the loan on a discount basis. Exercise 7-5 (Algo) Part a Required:a-1. Calculate the loan proceeds made available to Powell.
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★ Problem 1-6 (IAA) Cavalier Company provided the following information on December 31, 2021: Accounts payable Notes payable-bank Interest payable Mortgage note payable -10% Bonds payable ✰ 6,600,000 8,000,000 Bank notes payable include two separate notes payable to First Bank 150,000 2,000,000 4,000,000 A P3,000,000, 10% note issued March 1, 2020, payable on demand. Interest is payable every six months. A one-year, P5,000,000, 11% note issued January 2, 2021. On December 31, 2021, the entity negotiated a written agreement with First Bank to replace the note with a 2-year, P5,000,000, 10% note to be issued January 2, 2022. The 10% mortgage note was issued October 1, 2020 with a term of 10 years. Terms of the note give the holder the right to demand immediate payment if the entity fails to make a monthly interest payment within 10 days of the date the payment is due. On December 31, 2021, the entity is three months behind in paying the required interest payment. Required: Compute total…
The transaction below pertains to Boyer Coe Company, whose fiscal year ends December 31. On November 1, 2019 Coe borrowed $25,000 at 6 percent for 6 months. The entry to record the November 1 borrowing transaction would include a: A. Credit to notes payable for $750 B. Credit to notes payable for $24,250 C. Debit to cash for $24,250 D. Debit to cash for $25,000
Subject : Accounting