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 $6.7 million cash from Downtown Bank and signed a promissory note that matures in six months. The interest rate was 5.7 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.) 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 View transaction list Journal entry worksheet 1 Record the journal entry to record the note on November 1, 2020. Note: Enter debits before credits. Date November 01, 2020 1 Record the adjusting entry required on December 31, 2020. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2020 General Journal Debit Credit Record entry Clear entry View general journ Record entry Clear entry View general journ 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.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Don't give solution in image format..
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 $6.7 million cash from Downtown Bank and
signed a promissory note that matures in six months. The interest rate was 5.7 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.)
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
View transaction list
Journal entry worksheet
>
Record the journal entry to record the note on November 1, 2020.
Note: Enter debits before credits.
November 01,
2020
<
1
Record the adjusting entry required on December 31, 2020.
Note: Enter debits before credits.
General Journal
Debit
Credit
Date
December 31,
2020
General Journal
Debit
Credit
Record entry
Clear entry
View general journ
Record entry
Clear entry
View general journ
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.
Note: Enter debits before credits.
Date
April 30, 2021
General Journal
Debit
Credit
Record entry
Clear entry
View general journa
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 $6.7 million cash from Downtown Bank and signed a promissory note that matures in six months. The interest rate was 5.7 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.) 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 View transaction list Journal entry worksheet > Record the journal entry to record the note on November 1, 2020. Note: Enter debits before credits. November 01, 2020 < 1 Record the adjusting entry required on December 31, 2020. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2020 General Journal Debit Credit Record entry Clear entry View general journ Record entry Clear entry View general journ 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. Note: Enter debits before credits. Date April 30, 2021 General Journal Debit Credit Record entry Clear entry View general journa
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 1 images

Blurred answer
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education