On April 1, 2020, Mountain Company sold merchandise and received a $19,200, three-year, noninterest-bearing note. The market rate is 6%. Mountain Company has a March 31 year-end. The company uses the effective interest method to amortize any discount. Required Prepare all entries for Mountain Company over the note's term, including year-end adjustments. Note: Round amounts to the nearest whole dollar. Note: If multiple credits are required, list accounts in alphabetical order. Date April 1, 2020 Mar. 31, 2021 Mar. 31, 2022 Mar. 31, 2023 Mar. 31, 2023 Account Name To record interest on note To record settlement of note ◆ ♦ ◆ ◆ → + ◆ ÷ ♦ ◆ Dr. Cr.
On April 1, 2020, Mountain Company sold merchandise and received a $19,200, three-year, noninterest-bearing note. The market rate is 6%. Mountain Company has a March 31 year-end. The company uses the effective interest method to amortize any discount. Required Prepare all entries for Mountain Company over the note's term, including year-end adjustments. Note: Round amounts to the nearest whole dollar. Note: If multiple credits are required, list accounts in alphabetical order. Date April 1, 2020 Mar. 31, 2021 Mar. 31, 2022 Mar. 31, 2023 Mar. 31, 2023 Account Name To record interest on note To record settlement of note ◆ ♦ ◆ ◆ → + ◆ ÷ ♦ ◆ Dr. Cr.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Preparing Entries and Interest Schedule for Long-Term Note Receivable; Effective Interest Method
On April 1, 2020, Mountain Company sold merchandise and received a $19,200, three-year, noninterest-bearing note. The market rate is 6%. Mountain Company has a March 31 year-end. The
company uses the effective interest method to amortize any discount.
Required
Prepare all entries for Mountain Company over the note's term, including year-end adjustments.
Note: Round amounts to the nearest whole dollar.
Note: If multiple credits are required, list accounts in alphabetical order.
Date
April 1, 2020
Mar. 31, 2021
Mar. 31, 2022
Mar. 31, 2023
Mar. 31, 2023
Account Name
To record interest on note
To record settlement of note
♦
→
◆
♦
→
Dr.
Cr.
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