Your answer is partially correct. Prepare the journal entry to recognize interest on 12/31/25 for Sage Hill Company. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entry before credit entry. Round answers to O decimal places, e.g. 5,275.) Date Account Titles and Explanation 12/31/25 Discount on Notes Receivable Interest Revenue eTextbook and Media Debit Credit
Your answer is partially correct. Prepare the journal entry to recognize interest on 12/31/25 for Sage Hill Company. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entry before credit entry. Round answers to O decimal places, e.g. 5,275.) Date Account Titles and Explanation 12/31/25 Discount on Notes Receivable Interest Revenue eTextbook and Media Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On January 1, 2025, Sage Hill Company loans $202,008 to Oriole Corporation in exchange for a $240,000 zero-interest-bearing note
payable in 2 years. The market rate of interest for a transaction of this nature for Oriole is 9%. The present value of 1, 2 years out at
9% is 0.8417.
Sage Hill Company has a calendar year-end and it uses the effective-interest method.
(a)
Your answer is correct.
Prepare journal entries on 1/1/25 to recognize the loan for Sage Hill Company. (Credit account titles are automatically indented
when the amount is entered. Do not indent manually. List debit entry before credit entry.)
(b)
Date Account Titles and Explanation
1/1/25
Notes Receivable
Discount on Notes Receivable
Cash
eTextbook and Media
List of Accounts
Your answer is partially correct.
Date Account Titles and Explanation
12/31/25 Discount on Notes Receivable
Interest Revenue
Debit
eTextbook and Media
240000
Prepare the journal entry to recognize interest on 12/31/25 for Sage Hill Company. (Credit account titles are automatically indented
when the amount is entered. Do not indent manually. List debit entry before credit entry. Round answers to O decimal places, e.g. 5,275.)
Credit
Debit
37992
202008
Attempts: 1 of 15 used
Credit
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