Wellington Company had the following transactions involving notes payable.Nov. 1, 2020 Borrows $180,000 from Olathe State Bank by signing a 3-month, 10% note.Dec. 31, 2020 Prepares the adjusting entry.Feb. 1, 2021 Pays principal and interest to Olathe State Bank.Prepare journal entries for each of the transactions.

Book are closed on Dec. 31 and note matures on Feb. 1. So, an adjusting entry for interest accrued…

Answered: Wellington Company had the following…

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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Wellington Company had the following transactions involving notes payable.

Nov. 1, 2020		Borrows $180,000 from Olathe State Bank by signing a 3-month, 10% note.
Dec. 31, 2020		Prepares the adjusting entry.
Feb. 1, 2021		Pays principal and interest to Olathe State Bank.

Prepare journal entries for each of the transactions.

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