Which journal entry below would be properly used to record an issuance of an installment note (borrowing money) from First Bank on January 1 of this year. The principal of the note is $50,000, interest rate is 7%, terms of the note 5 years, annual payment $12,195. JOURNAL Page 25 DATE DESCRIPTION P.REF. DEBIT CREDIT Jan. 1 (1) (2) Notes Payable debit $50,000, Cash credit $50,000 Cash debit $12,195, Notes Payable credit $12,195 Cash debit $50,000, Notes Payable credit $50,000 Cash debit $12,195, Bonds Payable credit $12,195
Which journal entry below would be properly used to record an issuance of an installment note (borrowing money) from First Bank on January 1 of this year. The principal of the note is $50,000, interest rate is 7%, terms of the note 5 years, annual payment $12,195. JOURNAL Page 25 DATE DESCRIPTION P.REF. DEBIT CREDIT Jan. 1 (1) (2) Notes Payable debit $50,000, Cash credit $50,000 Cash debit $12,195, Notes Payable credit $12,195 Cash debit $50,000, Notes Payable credit $50,000 Cash debit $12,195, Bonds Payable credit $12,195
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Which journal entry below would be properly used to record an issuance of an installment note (borrowing money) from First Bank on January 1 of this year. The
principal of the note is $50,000, interest rate is 7%, terms of the note 5 years, annual payment $12,195.
JOURNAL
Page 25
DATE
DESCRIPTION
P.REF.
DEBIT
CREDIT
Jan. 1
(1)
(2)
Notes Payable debit $50,000, Cash credit $50,000
Cash debit $12,195, Notes Payable credit $12,195
Cash debit $50,000, Notes Payable credit $50,000
Cash debit $12,195, Bonds Payable credit $12,195](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb2cb6b53-8bc1-4971-ac49-59265633c58d%2Fedc9cfcf-742b-48fd-bded-99b6b4b6d6e0%2Fqpjn4z.png&w=3840&q=75)
Transcribed Image Text:Which journal entry below would be properly used to record an issuance of an installment note (borrowing money) from First Bank on January 1 of this year. The
principal of the note is $50,000, interest rate is 7%, terms of the note 5 years, annual payment $12,195.
JOURNAL
Page 25
DATE
DESCRIPTION
P.REF.
DEBIT
CREDIT
Jan. 1
(1)
(2)
Notes Payable debit $50,000, Cash credit $50,000
Cash debit $12,195, Notes Payable credit $12,195
Cash debit $50,000, Notes Payable credit $50,000
Cash debit $12,195, Bonds Payable credit $12,195
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