Monty Corporation issued a 4-year, $36,000, 4% note to Greenbush Company on January 1, 2017, and received a computer that normally sells for $27,253. The note requires annual interest payments each December 31. The market rate of interest for a note of similar risk is 12%. Prepare Monty's journal entries for (a) the January 1 issuance and (b) the December 31 interest.
Monty Corporation issued a 4-year, $36,000, 4% note to Greenbush Company on January 1, 2017, and received a computer that normally sells for $27,253. The note requires annual interest payments each December 31. The market rate of interest for a note of similar risk is 12%. Prepare Monty's journal entries for (a) the January 1 issuance and (b) the December 31 interest.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Monty Corporation issued a 4-year, $36,000, 4% note to
Greenbush Company on January 1, 2017, and received a
computer that normally sells for $27,253. The note
requires annual interest payments each December 31.
The market rate of interest for a note of similar risk is
12%.
Prepare Monty's journal entries for (a) the January 1
issuance and (b) the December 31 interest.
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