On November 7, Mura Company borrows $160,000 cash by signing a 90-day, 8%, $160,000 note payable. 1. Compute the accrued interest payable on December 31. 2. & 3. Prepare the journal entries to record the accrued interest expense at December 31 and payment of the note at maturity on February 5

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Req 1
Prepare the journal entries to record the accrued interest expense at December 31 and payment of the note at maturity
February 5. (Use 360 days a year. Do not round your intermediate calculations.)
General Journal
No
1
Req 2 and 3
2
Date
December 31
February 05
Interest expense
Interest payable
Notes payable
Cash
Interest expense
Interest payable
Notes payable
Cash
Debit
160,000
Credit
Transcribed Image Text:Req 1 Prepare the journal entries to record the accrued interest expense at December 31 and payment of the note at maturity February 5. (Use 360 days a year. Do not round your intermediate calculations.) General Journal No 1 Req 2 and 3 2 Date December 31 February 05 Interest expense Interest payable Notes payable Cash Interest expense Interest payable Notes payable Cash Debit 160,000 Credit
On November 7, Mura Company borrows
$160,000 cash by signing a 90-day, 8%,
$160,000 note payable.
1. Compute the accrued interest payable
on December 31.
2. & 3. Prepare the journal entries to
record the accrued interest expense at
December 31 and payment of the note at
maturity on February 5
Req 2 and 3
Compute the accrued interest payable on December 31. (Use 360 days a year. Do not round your intermediate calculations.)
* Rate(%)
Req 1
Total through maturity
Year end interest accrual
Interest recognized February 5
Principal
$ 160,000
$ 160,000
$ 160,000
%
8
80%
* Time
90/360
54/360
36/360
Req 2 and
Interest
and 3>
Transcribed Image Text:On November 7, Mura Company borrows $160,000 cash by signing a 90-day, 8%, $160,000 note payable. 1. Compute the accrued interest payable on December 31. 2. & 3. Prepare the journal entries to record the accrued interest expense at December 31 and payment of the note at maturity on February 5 Req 2 and 3 Compute the accrued interest payable on December 31. (Use 360 days a year. Do not round your intermediate calculations.) * Rate(%) Req 1 Total through maturity Year end interest accrual Interest recognized February 5 Principal $ 160,000 $ 160,000 $ 160,000 % 8 80% * Time 90/360 54/360 36/360 Req 2 and Interest and 3>
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