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Sabonis Cosmetics Co. purchased machinery on December 31, 2019, paying $50,000 down and agreeing to pay the balance in four equal installments of $40,000 payable each December 31. An assumed interest of 8% is implicit in the purchase price. Instructions Prepare the journal entries that would be recorded for the purchase and for the payments and interest on the following dates. (Round answers to the nearest cent.) a.   December 31, 2019. b.    December 31, 2020. c.   December 31, 2021. d.   December 31, 2022. e.   December 31, 2023.

Sabonis Cosmetics Co. purchased machinery on December 31, 2019, paying $50,000 down and agreeing to pay the balance in four equal installments of $40,000 payable each December 31. An assumed interest of 8% is implicit in the purchase price. Instructions Prepare the journal entries that would be recorded for the purchase and for the payments and interest on the following dates. (Round answers to the nearest cent.) a.   December 31, 2019. b.    December 31, 2020. c.   December 31, 2021. d.   December 31, 2022. e.   December 31, 2023.

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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Sabonis Cosmetics Co. purchased machinery on December 31, 2019, paying $50,000 down and agreeing to pay the balance in four equal installments of $40,000 payable each December 31. An assumed interest of 8% is implicit in the purchase price.

Instructions

Prepare the journal entries that would be recorded for the purchase and for the payments and interest on the following dates. (Round answers to the nearest cent.)

a.   December 31, 2019.

b.    December 31, 2020.

c.   December 31, 2021.

d.   December 31, 2022.

e.   December 31, 2023.

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