Learning Objective 3: Purchase inventory, accrue interest, and pay a short-termnote) On August 1, 2019, The Shoppes at Mill Lake, Inc., purchased inventory costing $40,000by signing a 6%, six-month, short-term note payable. The company will pay the entire note(principal and interest) on the note’s maturity date.Requirements1. Journalize the company’s purchase of inventory.2. Make the adjusting entry for accrual of interest on the note payable on December 31, 2019.3. At December 31, 2019, what is reported on the balance sheet related to this note payable?4. Record the payment of the note payable (principal and interest) on its maturity date
Learning Objective 3: Purchase inventory, accrue interest, and pay a short-termnote) On August 1, 2019, The Shoppes at Mill Lake, Inc., purchased inventory costing $40,000by signing a 6%, six-month, short-term note payable. The company will pay the entire note(principal and interest) on the note’s maturity date.Requirements1. Journalize the company’s purchase of inventory.2. Make the adjusting entry for accrual of interest on the note payable on December 31, 2019.3. At December 31, 2019, what is reported on the balance sheet related to this note payable?4. Record the payment of the note payable (principal and interest) on its maturity date
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Learning Objective 3: Purchase inventory, accrue interest, and pay a short-term
note) On August 1, 2019, The Shoppes at Mill Lake, Inc., purchased inventory costing $40,000
by signing a 6%, six-month, short-term note payable. The company will pay the entire note
(principal and interest) on the note’s maturity date.
Requirements
1. Journalize the company’s purchase of inventory.
2. Make the
3. At December 31, 2019, what is reported on the
4. Record the payment of the note payable (principal and interest) on its maturity date
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