United Airlines purchases a 24-month insurance policy for $48,000 on December 1 for immediate coverage. Expense recognized in December?

Income statement: Income statement: All revenues and expenses are shown in income statement. It…

Answered: United Airlines purchases a 24-month…

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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Similar questions

Journalize the following, assuming a 360-day year is used for interest computations: Apr. 30 Issued a $126,000, 30-day, 6% note dated April 30 to Misner Co. on account. May 30 Paid Misner Co. the amount owed on the note dated April 30. If an amount box does not require an entry, leave it blank. Apr. 30 May 30 3 3 000 ?
On October 1, Black Company receives a 10% interest-bearing note from Reese Company to settle a $17,800 account receivable. The note is due in six months. At December 31, Black should record interest revenue of a.$455 b.$442 c.$445 d.$452
A gift shop signs a three-month note payable on May 1/2020 of OMR 36,000 with an annual interest of 10%. What is the adjusting entry to be made on December 31 for the interest expense accrued to that date? Select one: O a. Debit Interest Expense, 2,400; Credit Interest Payable, 2,400. b. Debit Prepaid Interest, 2,000; Credit Interest Expense, 2,000. c. Debit Interest Expense, 2,100; Credit Interest Payable, 2,100. d. None of the answers are correct e. Debit Interest Expense, 2,400; Credit Prepaid Interest, 2,400.
On April 12 Hong co. agrees to accept a 60 day, 6% 6,900 note from indigo co to extend the due date on an overdue account. What is the journal entry the indigo co would make when it record payment of note on maturity date (use 360 days a year)
On July 8, Jones Inc. issued an $67,200, 9%, 120-day note payable to Miller Company. Assume that the fiscal year of Jones ends July 31. Using a 360-day year, what is the amount of interest expense recognized by Jones in the current fiscal year? When required, round your answer to the nearest dollar. a. $6,048 b. $1,158 c. $386 d. $772
At 31 December 20X5 the following require inclusion in a company's financial statements: On 1 January 20X5 the company made a loan of $12,000 to an employee, repayable on 1 January 20X6, charging interest at 2% per year. On the due date she repaid the loan and paid 1 the whole of the interest due on the loan to that date. The company paid an annual insurance premium of $9,000 in 20X5, covering the year ending 31 August 20X6. 3 In January 20X6 the company received rent from a tenant of $4,000 covering the six months to 31 December 20X5. For these items, what total figures should be included in the company's statement of financial position as at 31 December 20X5?
On January 23, 2019, Zenox Company sold $105,000 of furniture on account that had a cost of $82,000. All of Zenox's sales are covered by an unconditional 24-month replacement warranty. Historical data indicates that warranty costs average 2% of the cost of sales. On January 29, 2019, Zenox replaced furniture with a cost of $2,000 that was covered by warranty. Required: a. Prepare the journal entry to record the estimated warranty liability for January. b. Prepare the entry to record the warranty expense incurred in January. c. Assuming the Estimated Warranty Liability account had a credit balance of $740 on January 1, 2019, calculate the balance at January 31, 2019 after the entries above were posted.
Logan Manufacturing Co. warrants its products for one year. The estimated product warranty is 4% of sales. Assume that sales were $660,000 for January. In February, a customer received warranty repairs requiring $250 of parts and $95 of labor. Required: a. Journalize the adjusting entry required at January 31, the end of the first month of the current fiscal year, to record the accrued product warranty.* CHART OF ACCOUNTS Logan Manufacturing Co. General Ledger ASSETS 110 Cash 111 Accounts Receivable 112 Interest Receivable 113 Notes Receivable 115 Merchandise Inventory 116 Supplies 118 Prepaid Insurance 120 Land 123 Building 124 Accumulated Depreciation-Building 125 Office Equipment 126 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 213 Interest Payable 214 Notes Payable 215 Wages Payable 216 Social Security Tax Payable 217 Medicare Tax Payable 218 Employees Federal Income Tax Payable…

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