On July 1, 2025, Waterway Inc. made two sales. 1. 2. It sold land having a fair value of $913,050 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,436,698. The land is carried on Waterway's books at a cost of $592,800. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $407,700 (interest payable annually). Waterway Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest. Record the two journal entries that should be recorded by Waterway Inc. for the sales transactions above that took place on July 1, 2025 (Pound present value factor calculations to 5 decimal places, eg 1.25124 and final answers to 0 decimal places. e.g. 5.275. If no entry is
On July 1, 2025, Waterway Inc. made two sales. 1. 2. It sold land having a fair value of $913,050 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,436,698. The land is carried on Waterway's books at a cost of $592,800. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $407,700 (interest payable annually). Waterway Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest. Record the two journal entries that should be recorded by Waterway Inc. for the sales transactions above that took place on July 1, 2025 (Pound present value factor calculations to 5 decimal places, eg 1.25124 and final answers to 0 decimal places. e.g. 5.275. If no entry is
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Dhapa
Transcribed Image Text:On July 1, 2025, Waterway Inc. made two sales.
1.
2.
It sold land having a fair value of $913,050 in exchange for a 4-year zero-interest-bearing promissory note in the face amount
of $1,436,698. The land is carried on Waterway's books at a cost of $592,800.
It rendered services in exchange for a 3%, 8-year promissory note having a face value of $407,700 (interest payable annually).
Waterway Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two
transactions have credit ratings that require them to borrow money at 12% interest.
Record the two journal entries that should be recorded by Waterway Inc. for the sales transactions above that took place on July 1,
2025. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275. If no entry is
required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount
is entered. Do not indent manually. List all debit entries before credit entries.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education