R On April 1, 2024, Donyel Boats Company sold a yacht to Darien Resorts & Company for $450,000. Darien paid $95,000 down and issued a 12-month, 12% interest-bearing note for the balance. The principal and interest are due at maturity. The 10% interest rate reflects the market rate of interest at the time of sale. On July 1, 2024, Donyel Boats Company discounted the note, without recourse, at Nations Trust Bank at 12% interest. REQUIRED: Prepare journal entries on the books of Donyel Boats Company to record: (1) The purchase of the yacht on January 1, 2024 (2) The discounting of the note at Nations Trust Bank on July 1, 2024. (3) Assuming that the note was not discounted, the payment of principal and interest on March 31, 2025 the maturity date. HINT: Donyel's books were closed December 31, 2024.

R On April 1, 2024, Donyel Boats Company sold a yacht to Darien Resorts & Company for $450,000. Darien paid $95,000 down and issued a 12-month, 12% interest-bearing note for the balance. The principal and interest are due at maturity. The 10% interest rate reflects the market rate of interest at the time of sale. On July 1, 2024, Donyel Boats Company discounted the note, without recourse, at Nations Trust Bank at 12% interest. REQUIRED: Prepare journal entries on the books of Donyel Boats Company to record: (1) The purchase of the yacht on January 1, 2024 (2) The discounting of the note at Nations Trust Bank on July 1, 2024. (3) Assuming that the note was not discounted, the payment of principal and interest on March 31, 2025 the maturity date. HINT: Donyel's books were closed December 31, 2024.

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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Question

On April 1, 2024, Donyel Boats Company sold a yacht to Darien Resorts & Company for
$450,000. Darien paid $95,000 down and issued a 12-month, 12% interest-bearing note for the
balance. The principal and interest are due at maturity. The 10% interest rate reflects the
market rate of interest at the time of sale.
On July 1, 2024, Donyel Boats Company discounted the note, without recourse, at Nations Trust
Bank at 12% interest.
REQUIRED:
Prepare journal entries on the books of Donyel Boats Company to record:
(1) The purchase of the yacht on January 1, 2024
(2) The discounting of the note at Nations Trust Bank on July 1, 2024.
(3) Assuming that the note was not discounted, the payment of principal and interest on
March 31, 2025 the maturity date.
HINT: Donyel's books were closed December 31, 2024.

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