On January 2, Avalon Enterprises Ltd. borrowed $500,000 on a 15- year, 8 percent note payable. Interest plus $25,000 principal is due September 30 each year, beginning 2024. On September 30, the first $25,000 principal payment plus nine months' interest was made on the note payable described above. Provide the journal entry for this transaction.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
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Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...
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On January 2, Avalon Enterprises Ltd. borrowed $500,000 on a 15-
year, 8 percent note payable. Interest plus $25,000 principal is due
September 30 each year, beginning 2024. On September 30, the first
$25,000 principal payment plus nine months' interest was made on the
note payable described above. Provide the journal entry for this
transaction.
Transcribed Image Text:On January 2, Avalon Enterprises Ltd. borrowed $500,000 on a 15- year, 8 percent note payable. Interest plus $25,000 principal is due September 30 each year, beginning 2024. On September 30, the first $25,000 principal payment plus nine months' interest was made on the note payable described above. Provide the journal entry for this transaction.
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