Many businesses borrow money during periods of increased business activity to finance inventory and accounts receivable. Hudson's Bay Company (HBC) is Canada's largest department store. Each Christmas, HBC builds up its inventory to meet the needs of Christmas shoppers. A large portion of Christmas sales are on credit. As a result, HBC often collects cash from the sales several months after Christmas. Assume that on November 1, 2020, HBC borrowed $7.7 million cash from Downtown Bank and signed a promissory note that matures in six months. The interest rate was 5.4 percent payable at maturity. The accounting period ends December 31. Required: 1. Prepare the journal entry to record the note on November 1, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 Record the journal entry to record the note on November 1, 2020. 2. Prepare any adjusting entry required on December 31, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 Record the adjusting entry required on December 31, 2020. 3. Prepare the journal entry to record payment of the note and interest on the maturity date, April 30, 2021, assuming that interest has not been recorded since December 31, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 Record the payment of the note and interest on the maturity date, April 30, 2021, assuming that interest has not been recorded since December 31, 2020.
Many businesses borrow money during periods of increased business activity to finance inventory and accounts receivable. Hudson's Bay Company (HBC) is Canada's largest department store. Each Christmas, HBC builds up its inventory to meet the needs of Christmas shoppers. A large portion of Christmas sales are on credit. As a result, HBC often collects cash from the sales several months after Christmas. Assume that on November 1, 2020, HBC borrowed $7.7 million cash from Downtown Bank and signed a promissory note that matures in six months. The interest rate was 5.4 percent payable at maturity. The accounting period ends December 31. Required: 1. Prepare the journal entry to record the note on November 1, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 Record the journal entry to record the note on November 1, 2020. 2. Prepare any adjusting entry required on December 31, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 Record the adjusting entry required on December 31, 2020. 3. Prepare the journal entry to record payment of the note and interest on the maturity date, April 30, 2021, assuming that interest has not been recorded since December 31, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 1 Record the payment of the note and interest on the maturity date, April 30, 2021, assuming that interest has not been recorded since December 31, 2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
answer in text form please (without image), Note: .Every entry should have narration please
Transcribed Image Text:Many businesses borrow money during periods of increased business activity to finance inventory and accounts receivable. Hudson's
Bay Company (HBC) is Canada's largest department store. Each Christmas, HBC builds up its inventory to meet the needs of Christmas
shoppers. A large portion of Christmas sales are on credit. As a result, HBC often collects cash from the sales several months after
Christmas. Assume that on November 1, 2020, HBC borrowed $7.7 million cash from Downtown Bank and signed a promissory note
that matures in six months. The interest rate was 5.4 percent payable at maturity. The accounting period ends December 31.
Required:
1. Prepare the journal entry to record the note on November 1, 2020. (If no entry is required for a transaction/event, select "No
journal entry required" in the first account field. Enter your answers in whole dollars.)
View transaction list
Journal entry worksheet
1
Record the journal entry to record the note on November 1, 2020.
2. Prepare any adjusting entry required on December 31, 2020. (If no entry is required for a transaction/event, select "No journal
entry required" in the first account field. Enter your answers in whole dollars.)
View transaction list
Journal entry worksheet
< 1
Record the adjusting entry required on December 31, 2020.
3. Prepare the journal entry to record payment of the note and interest on the maturity date, April 30, 2021, assuming that interest has
not been recorded since December 31, 2020. (If no entry is required for a transaction/event, select "No journal entry required" in
the first account field. Enter your answers in whole dollars.)
View transaction list
Journal entry worksheet
< 1
Record the payment of the note and interest on the maturity date, April 30,
2021, assuming that interest has not been recorded since December 31, 2020.
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