On January 1, 2020, X company acquired an equipment for P1,000,000 payable in 5 annual equal installments every December 31 of each year. Interest is 10% on the unpaid balance. Required: Prepare the all the relevant journal entries in 2020 and 2021
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On January 1, 2020, X company acquired an equipment for P1,000,000 payable in 5 annual equal installments every December 31 of each year. Interest is 10% on the unpaid balance.
Required:
Prepare the all the relevant
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- On January 1, 2021, Gundy Enterprises purchases an office building for $184,000, paying $44.000 down and borrowing the remaining $140,000signing a 7%10-year mortgageInstallment payments of $are due at the end of each monthwith the first payment due on January 31, 2021 Required: 1. Record the purchase of the building on January 12021. (no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)Muffin Co. issues an $800,000, 10%, 10-year mortgage note on December 31, 2019, to obtain financing for a new building. The terms provide for semiannual installment payments of $64,194. Instructions Prepare two entrles to record the mortgage loan on December 31, 2019, and the first installment payment. Essay Toolbar navigation B I U SAt the end of 2022, the following information is available for Great Adventures. Additional interest for five months needs to be accrued on the $32,200, 6% loan obtained on August 1, 2021. Recall that annual interest is paid each July 31. Assume that $12,200 of the $32,200 loan discussed above is due next year. By the end of the year, $20,000 in gift cards have been redeemed. The company had sold gift cards of $27,200 during the year and recorded those as Deferred Revenue. Great Adventures is a defendant in litigation involving a biking accident during one of its adventure races. The company believes the likelihood of payment occurring is probable, and the estimated amount to be paid is $14,200. For sales of MU watches, Great Adventures offers a warranty against defect for one year. At the end of the year, the company estimates future warranty costs to be $6,200. No Date General Journal Debit Credit 1 Dec 31 Interest Expense 805 Interest Payable 805…
- Midshipmen Company borrows $18,000 from Falcon Company on July 1, 2024. Midshipmen repays the amount borrowed and pays interest of 12% (1%/month) on June 30, 2025. Required: 1.&2. Record the necessary entries in the Journal Entry Worksheet below for Midshipmen Company. 3. Calculate the 2024 year-end adjusted balances of Interest Payable and Interest Expense (assuming the balance of Interest Payable at the beginning of the year is $0).Mewto Bank granted a loan to Mew Company on January 1, 2020. The interest on the loan is 12% payable annually starting December 31, 2020. The loan matures in four years. Principal amount P5,000,000 Direct origination cost incurred 120,000 Indirect origination cost incurred 50,000 Origination fee received from the borrower 400,000 After considering the origination fee received from the borrower and the direct origination cost incurred, the effective rate on the loan is 14%. How much is the interest income to be recognized on December 31, 2021?LCD Industries purchased a supply of electronic components from Entel Corporation on November 1, 2024. In payment for the $24.7 million purchase, LCD issued a 1-year installment note to be paid in equal monthly payments at the end of each month. The payments include interest at the rate of 24%. Required: 1. & 2. Prepare the journal entries for LCD’s purchase of the components on November 1, 2024 and the first installment payment on November 30, 2024. 3. What is the amount of interest expense that LCD will report in its income statement for the year ended December 31, 2024?
- On November 30, 2018, EZ Products borrowed $48,000 on a 5%, 10-year note with annual installment payments of $4,800 plus interest due on November 30 of each succeeding year. How much interest expense should be accrued at December 31, 2018 for the period of November 30 through year-end? Select one: a. $200 b. $400 c. $2,400 d. $1,200LCD Industries purchased a supply of electronic components from Entel Corporation on November 1, 2024. In payment for the $24.8 million purchase, LCD issued a 1-year installment note to be paid in equal monthly payments at the end of each month. The payments include interest at the rate of 12%. Required: 1. & 2. Prepare the journal entries for LCD's purchase of the components on November 1, 2024 and the first installment payment on November 30, 2024. 3. What is the amount of interest expense that LCD will report in its income statement for the year ended December 31, 2024?Note Payable problem:On October 1, 2021, Good Luck Inc. received Equipment valued at $900,000 in exchange for a 10% long-term note payable. The note is payable over a 20-year term in $45,000 principal installments due on October 1 of each year, beginning October 1, 2022. At the time of each installment the interest due at that time is paid also. provide the following 3 journal entries:* The October 1, 2021 entry to receive the Equipment and put the note on the books.* the Dec 31, 2021 adjusting entry for 3 months of interest.* and the October 1, 2022 payment of the installment and interest. (with proper format )
- Island Solutions started construction of a new office building for its own use at an estimated cost of $5 000 000 on January 1, 2022, and completed the construction on December 31, 2022. i During the year of construction (2022) the company had outstanding the following debt obligations. ii. Specific Construction Debt: $2 000 000 12% note issued December 31, 2021. Interest payable semi-annually iii. Other Debt: $1 400 000 10% short-term loan. Interest payable monthly and principal payable at maturity on May 30, 2023, $1 000 000 11% long-term loan. Interest payable on January 1 of each year and principal payable at maturity on January 1, 2025 Total expenditures - $5 200 000 Weighted average accumulated expenditures - $3 500 000 One of the accounting interns on the other team having reviewed the statement of financial position commented that it just did not make any sense, this ’avoidable interest’. Isn’t all interest unavoidable? No one lends money without expecting to be compensated for…MNO Bank granted a loan to a borrower on January 1, 2020. The interest on the loan is 10% payable annually starting December 31, 2020. The loan matures in three years on December 31, 2022. Additional information is as follows: Principal amount of P5,000,000; Direct origination cost incurred for P100,000; Indirect origination cost incurred for P50,000 and Origination fee received from the borrower was P340,000. After considering the origination fee received from the borrower and the direct origination cost incurred, the effective rate on the loan is 12%. Compute for the interest income for 2020.Novak Corp. receives $375,600 when it issues a $375,600, 10% mortgage note payable to finance the construction of a building at December 31, 2022. The terms provide for annual installment payments of $62,600 on December 31. Prepare the journal entries to record the mortgage loan and the first two payments.