Scrimiger Paints wants to upgrade its machinery and on September 20 takes out a loan from the bank in the amount of $670,000. The terms of the loan are 3.8% annual interest rate and payable in 8 months. Interest is due in equal payments each month. A. Compute the interest expense due each month. If required, round final answer 2,121.67 ✔ Feedback Check My Work Remember the formula used to calculate the amount of interest expense. Refer to the textbook for an example. The formula involves three important components. B. Show the journal entry to recognize the interest payment on October 20, and the entry for payment of the short-term note and final interest payment on May 20. If required, round final answers to two decimal places. If an amount box does not require an entry, leave it blank. Oct. 20 Interest Expense - ✓ Cash ✔ May 20 Short-Term Notes Payable Interest Expense ✔ Cash ✔ ✓ 2,121.67 ✓ two decimal places. 2,121.67 ✔ 672,121.67 ✔

Scrimiger Paints wants to upgrade its machinery and on September 20 takes out a loan from the bank in the amount of $670,000. The terms of the loan are 3.8% annual interest rate and payable in 8 months. Interest is due in equal payments each month. A. Compute the interest expense due each month. If required, round final answer 2,121.67 ✔ Feedback Check My Work Remember the formula used to calculate the amount of interest expense. Refer to the textbook for an example. The formula involves three important components. B. Show the journal entry to recognize the interest payment on October 20, and the entry for payment of the short-term note and final interest payment on May 20. If required, round final answers to two decimal places. If an amount box does not require an entry, leave it blank. Oct. 20 Interest Expense - ✓ Cash ✔ May 20 Short-Term Notes Payable Interest Expense ✔ Cash ✔ ✓ 2,121.67 ✓ two decimal places. 2,121.67 ✔ 672,121.67 ✔

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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