The following are selected 2017 transactions of Sean Astin Corporation. Sept. 1 Purchased inventory from Encrino Company on account for $50,000. Astin records purchases gross and uses a periodic inventory system. Oct. 1 Issued a $50,000 12-month, 8% note to Encino in payment of account Oct. 1 Borrowed $50,000 from the Shore Bank by signing a 12-month, zero-interest-bearing $54,000 note. Instructions: (A) Prepare journal entries for the selected transactions above (B) Prepare adjusting entries at December 31 (C) Compute the total net liability to be reported on the December 31 balance sheet for: The interest-bearing note & the zero-interest-bearing note.
The following are selected 2017 transactions of Sean Astin Corporation. Sept. 1 Purchased inventory from Encrino Company on account for $50,000. Astin records purchases gross and uses a periodic inventory system. Oct. 1 Issued a $50,000 12-month, 8% note to Encino in payment of account Oct. 1 Borrowed $50,000 from the Shore Bank by signing a 12-month, zero-interest-bearing $54,000 note. Instructions: (A) Prepare journal entries for the selected transactions above (B) Prepare adjusting entries at December 31 (C) Compute the total net liability to be reported on the December 31 balance sheet for: The interest-bearing note & the zero-interest-bearing note.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The following are selected 2017 transactions of Sean Astin Corporation.
Sept. 1 Purchased inventory from Encrino Company on account for $50,000. Astin records purchases gross and uses a periodic inventory system.
Oct. 1 Issued a $50,000 12-month, 8% note to Encino in payment of account
Oct. 1 Borrowed $50,000 from the Shore Bank by signing a 12-month, zero-interest-bearing $54,000 note.
Instructions: (A) Prepare
(B) Prepare
(C) Compute the total net liability to be reported on the December 31 balance sheet for: The interest-bearing note & the zero-interest-bearing note.
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