The unadjusted trial balance of the Manufacturing Equitable at December 31, 2024, the end of its fiscal year, included the following account balances. Manufacturing's 2024 financial statements were issued on April 1, 2025. Accounts receivable Accounts payable 10% notes, payable to bank Mortgage note payable $ 92,500 35,000 600,000 1,200,000 Other information: a. The bank notes, issued August 1, 2024, are due on July 31, 2025, and pay interest at a rate of 10%, payable at maturity. b. The mortgage note is due on March 1, 2025. Interest at 9% has been paid up to December 31 (assume 9% is a realistic rate). Manufacturing intended at December 31, 2024, to refinance the note on its due date with a new 10-year mortgage note. In fact, on March 1, Manufacturing paid $250,000 in cash on the principal balance and refinanced the remaining $950,000. c. Included in the accounts receivable balance at December 31, 2024, were two subsidiary accounts that had been overpaid and had credit balances totaling $18,000. The accounts were of two major customers who were expected to order more merchandise from Manufacturing and apply the overpayments to those future purchases. d. On November 1, 2024, Manufacturing rented a portion of its factory to a tenant for $30,000 per year, payable in advance. The payment for the 12 months ended October 31, 2025, was received as required and was credited to deferred revenue. Required: 1. Prepare any necessary adjusting journal entries at December 31, 2024, pertaining to each item of other information (a-d). 2. Prepare the current and long-term liability sections of the December 31, 2024, balance sheet.
The unadjusted trial balance of the Manufacturing Equitable at December 31, 2024, the end of its fiscal year, included the following account balances. Manufacturing's 2024 financial statements were issued on April 1, 2025. Accounts receivable Accounts payable 10% notes, payable to bank Mortgage note payable $ 92,500 35,000 600,000 1,200,000 Other information: a. The bank notes, issued August 1, 2024, are due on July 31, 2025, and pay interest at a rate of 10%, payable at maturity. b. The mortgage note is due on March 1, 2025. Interest at 9% has been paid up to December 31 (assume 9% is a realistic rate). Manufacturing intended at December 31, 2024, to refinance the note on its due date with a new 10-year mortgage note. In fact, on March 1, Manufacturing paid $250,000 in cash on the principal balance and refinanced the remaining $950,000. c. Included in the accounts receivable balance at December 31, 2024, were two subsidiary accounts that had been overpaid and had credit balances totaling $18,000. The accounts were of two major customers who were expected to order more merchandise from Manufacturing and apply the overpayments to those future purchases. d. On November 1, 2024, Manufacturing rented a portion of its factory to a tenant for $30,000 per year, payable in advance. The payment for the 12 months ended October 31, 2025, was received as required and was credited to deferred revenue. Required: 1. Prepare any necessary adjusting journal entries at December 31, 2024, pertaining to each item of other information (a-d). 2. Prepare the current and long-term liability sections of the December 31, 2024, balance sheet.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Prepare any necessary adjusting journal entries at December 31, 2024, pertaining to each item of other information (a-d).
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
View transaction list
Journal entry worksheet
1 2 3 4
The Bank notes, issued August 1, 2024, are due on July 31, 2025, and pay
interest at a rate of 10%, payable at maturity.
Note: Enter debits before credits.
Transaction
a
Record entry
Show Transcribed Text
General Journal
Required 1 Required 2
Current liabilities:
Clear entry
Total current liabilities
Long-term liabilities:
Prepare the current and long-term liability sections of the December 31, 2024, balance sheet.
Manufacturing Equitable
Balance Sheet (partial)
At December 31, 2024
Debit
Total Long-term Liabilities
Total Liabilities
Credit
View general journal
Transcribed Image Text:The unadjusted trial balance of the Manufacturing Equitable at December 31, 2024, the end of its fiscal year, included the following
account balances. Manufacturing's 2024 financial statements were issued on April 1, 2025.
Accounts receivable
Accounts payable
10% notes, payable to bank
Mortgage note payable
$ 92,500
35,000
600,000
1,200,000
Other information:
a. The bank notes, issued August 1, 2024, are due on July 31, 2025, and pay interest at a rate of 10%, payable at maturity.
b. The mortgage note is due on March 1, 2025. Interest at 9% has been paid up to December 31 (assume 9% is a realistic rate).
Manufacturing intended at December 31, 2024, to refinance the note on its due date with a new 10-year mortgage note. In fact,
on March 1, Manufacturing paid $250,000 in cash on the principal balance and refinanced the remaining $950,000.
c. Included in the accounts receivable balance at December 31, 2024, were two subsidiary accounts that had been overpaid and
had credit balances totaling $18,000. The accounts were of two major customers who were expected to order more
merchandise from Manufacturing and apply the overpayments to those future purchases.
d. On November 1, 2024, Manufacturing rented a portion of its factory to a tenant for $30,000 per year, payable in advance. The
payment for the 12 months ended October 31, 2025, was received as required and was credited to deferred revenue.
Required:
1. Prepare any necessary adjusting journal entries at December 31, 2024, pertaining to each item of other information (a-d).
2. Prepare the current and long-term liability sections of the December 31, 2024, balance sheet.
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