On April 15, 2024, Sampson Consulting provides services to a customer for $109,000. To pay for the services, the customer signs a three-year, 12% note. The face amount is due at the end of the third year, while annual interest is due each April 15. (Hint: Because the note is accepted during the middle of the month, Sampson plans to recognize one-half month of interest revenue in April 2024, and one-half month of interest revenue in April 2027.) Required: 1. Record the acceptance of the note on April 15, 2024. 2. Record the adjusting entry for interest revenue on December 31 for 2024, 2025, and 2026, and the collection of annual interest on April 15, 2025 and 2026. 3. Record the cash collection on April 15, 2027. Prepare the journal entries for the above transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

On April 15, 2024, Sampson Consulting provides services to a customer for $109,000. To pay for the services, the customer signs a three-year, 12% note. The face amount is due at the end of the third year, while annual interest is due each April 15. (Hint: Because the note is accepted during the middle of the month, Sampson plans to recognize one-half month of interest revenue in April 2024, and one-half month of interest revenue in April 2027.) Required: 1. Record the acceptance of the note on April 15, 2024. 2. Record the adjusting entry for interest revenue on December 31 for 2024, 2025, and 2026, and the collection of annual interest on April 15, 2025 and 2026. 3. Record the cash collection on April 15, 2027. Prepare the journal entries for the above transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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