The following selected transactions relate to liabilities of Rocky Mountain Adventures. Rocky Mountain's fiscal year ends on December 31. January 13 Negotiate a revolving credit agreement with First Bank that can be renewed annually upon bank approval. The amount available under the line of credit is $10 million at the banks prime rate. February 1 Arrange a three-month bank loan of $4.1 million with First Bank under the line of credit agreement. Interest at the prime rate of 8% is payable at maturity. May 1 Pay the 8% note at maturity. Required: Record the appropriate entries, if any, on January 13, February 1, and May 1. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in dollars, not in millions (i.e. 5 should be entered as 5,000,000).) Journal entry worksheet 1 2 Record the receipt of revolving credit. Note: Enter debits before credits. Date General Journal Debit Credit January 13 Record entry Clear entry View general journal 3. Journal entry worksheet Journal entry worksheet 2 く 2 3 Record the bank loan. Record the payment of the note at maturity. Note: Enter debits before credits. Note: Enter debits before credits. Date General Journal Debit Credit Date General Journal Debit Credit February 01 May 01 Record entry Clear entry View general journal Record entry Clear entry View general journal
The following selected transactions relate to liabilities of Rocky Mountain Adventures. Rocky Mountain's fiscal year ends on December 31. January 13 Negotiate a revolving credit agreement with First Bank that can be renewed annually upon bank approval. The amount available under the line of credit is $10 million at the banks prime rate. February 1 Arrange a three-month bank loan of $4.1 million with First Bank under the line of credit agreement. Interest at the prime rate of 8% is payable at maturity. May 1 Pay the 8% note at maturity. Required: Record the appropriate entries, if any, on January 13, February 1, and May 1. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in dollars, not in millions (i.e. 5 should be entered as 5,000,000).) Journal entry worksheet 1 2 Record the receipt of revolving credit. Note: Enter debits before credits. Date General Journal Debit Credit January 13 Record entry Clear entry View general journal 3. Journal entry worksheet Journal entry worksheet 2 く 2 3 Record the bank loan. Record the payment of the note at maturity. Note: Enter debits before credits. Note: Enter debits before credits. Date General Journal Debit Credit Date General Journal Debit Credit February 01 May 01 Record entry Clear entry View general journal Record entry Clear entry View general journal
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:The following selected transactions relate to liabilities of Rocky Mountain Adventures. Rocky Mountain's fiscal year ends on December
31.
January 13 Negotiate a revolving credit agreement with First Bank that can be renewed annually upon bank approval. The amount
available under the line of credit is $10 million at the banks prime rate.
February 1 Arrange a three-month bank loan of $4.1 million with First Bank under the line of credit agreement. Interest at the prime rate
of 8% is payable at maturity.
May 1 Pay the 8% note at maturity.
Required:
Record the appropriate entries, if any, on January 13, February 1, and May 1. (If no entry is required for a transaction/event, select "No
journal entry required" in the first account field. Enter your answers in dollars, not in millions (i.e. 5 should be entered as
5,000,000).)
Journal entry worksheet
1
2
Record the receipt of revolving credit.
Note: Enter debits before credits.
Date
General Journal
Debit
Credit
January 13
Record entry
Clear entry
View general journal
3.
Transcribed Image Text:Journal entry worksheet
Journal entry worksheet
2
く
2
3
Record the bank loan.
Record the payment of the note at maturity.
Note: Enter debits before credits.
Note: Enter debits before credits.
Date
General Journal
Debit
Credit
Date
General Journal
Debit
Credit
February 01
May 01
Record entry
Clear entry
View general journal
Record entry
Clear entry
View general journal
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