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FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ontario Company, a natural energy supplier, borrowed P8,000,000 cash on November 1, 2021 to fund a geological survey. The loan was granted by United Bank under short-term credit line. Ontario Company issued a 9-month 12% promissory note with interest payable at maturity. The fiscal period is the calendar year. Required: 1. Prepare the journal entry for the issuance of the note payable by Ontario Company. 2. Prepare the appropriate adjusting entry for the note payable on December 31, 2021. 3. Prepare the journal entry for the payment of the note payable at maturity.
Transcribed Image Text:Ontario Company, a natural energy supplier, borrowed P8,000,000 cash on November 1, 2021 to fund a geological survey. The loan was granted by United Bank under short-term credit line. Ontario Company issued a 9-month 12% promissory note with interest payable at maturity. The fiscal period is the calendar year. Required: 1. Prepare the journal entry for the issuance of the note payable by Ontario Company. 2. Prepare the appropriate adjusting entry for the note payable on December 31, 2021. 3. Prepare the journal entry for the payment of the note payable at maturity.
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