Sunland Construction Ltd. borrowed $210,000 from Atco Finance Ltd. on October 1, 2020, by issuing a nine-month note payable at 5% interest payable at maturity. Both companies have a December 31 year end and make adjusting entries annually. (a) For Sunland Construction, record (1) the receipt of the $210,000 cash and the issuing of the note payable on October 1, 2020; (2) the accrual of interest on December 31, 2020; and (3) the payment of the note and interest on July 1, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Sunland Construction Ltd. borrowed $210,000 from Atco Finance Ltd. on October 1, 2020, by issuing a nine-month note payable at 5% interest payable at maturity. Both companies have a December 31 year end and make adjusting entries annually. (a) For Sunland Construction, record (1) the receipt of the $210,000 cash and the issuing of the note payable on October 1, 2020; (2) the accrual of interest on December 31, 2020; and (3) the payment of the note and interest on July 1, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Sunland Construction Ltd. borrowed $210,000 from Atco Finance Ltd. on October 1, 2020, by issuing a nine-month note payable at
5% interest payable at maturity. Both companies have a December 31 year end and make adjusting entries annually.
(a)
For Sunland Construction, record (1) the receipt of the $210,000 cash and the issuing of the note payable on October 1, 2020; (2)
the accrual of interest on December 31, 2020; and (3) the payment of the note and interest on July 1, 2021. (Credit account titles
are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Date
Account Titles and Explanation
(To record interest)
(To record repayment of bank loan)
Debit
U
Cred
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