On December 31,2019, Halen company performed environmental consulting services for Stuart Corporation was short of cash, and Halen company agreed to accept 900,000 zero- interest-bearing note due December 31, 2021 as payment in full. Stuart Corporation is somewhat of a credit risk and typically borrows funds at a rate of 10%. (PVIFA n=2,i=10% =1.7355 and PVIF n=2,i=10% =0.8264) Instruction: 3.1 Prepare the journal entry to record the transaction of December 31, 2019, for Halen company. 3.2 Assuming Halen’s fiscal year-end is December 31, prepare the journal entry for December 31, 2020.
On December 31,2019, Halen company performed environmental consulting services for Stuart Corporation was short of cash, and Halen company agreed to accept 900,000 zero- interest-bearing note due December 31, 2021 as payment in full. Stuart Corporation is somewhat of a credit risk and typically borrows funds at a rate of 10%. (PVIFA n=2,i=10% =1.7355 and PVIF n=2,i=10% =0.8264) Instruction: 3.1 Prepare the journal entry to record the transaction of December 31, 2019, for Halen company. 3.2 Assuming Halen’s fiscal year-end is December 31, prepare the journal entry for December 31, 2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
On December 31,2019, Halen company performed
environmental consulting services for Stuart Corporation was short
of cash, and Halen company agreed to accept 900,000 zero-
interest-bearing note due December 31, 2021 as payment in full.
Stuart Corporation is somewhat of a credit risk and typically
borrows funds at a rate of 10%. (PVIFA n=2,i=10% =1.7355 and PVIF
n=2,i=10% =0.8264)
Instruction:
3.1 Prepare the
December 31, 2019, for Halen company.
3.2 Assuming Halen’s fiscal year-end is December 31,
prepare the journal entry for December 31, 2020.
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