Zing Cell Phone Company entered into the following transactions involving current liabilities during 2020 and 2021. 2020 Mar. 14 Purchased merchandise on credit from Ferris Inc. for $160,000. The terms were 1/10, n/30 (assume a perpetual inventory system). Apr. 14 Zing paid $35,000 cash and replaced the $125,000 remaining balance of the account payable to Ferris Inc. with a 6%, 60-day note payable. May 21 Borrowed $135,000 from Scotiabank by signing a 5.5%, 90-day note. ? Paid the note to Ferris Inc. at maturity. ? Paid the note to Scotiabank at maturity. Dec. 15 Borrowed $110,000 and signed a 6.25%, 120-day note with National Bank. Dec. 31 Recorded an adjusting entry for the accrual of interest on the note to National Bank. 2021 ? Paid the note to National Bank at maturity. Required: 1. Determine the maturity dates of the three notes just described. 2. Present journal entries for each of the preceding dates. (Use 365 days an year. Do not round intermediate calculations and round the final answers to 2 decimal places.) Record the purchase of merchandise on credit 2 Record the payment of cash and a note written to extend due date. 3 Record the borrowing of cash with a 90-day against note. 4 Record the payment of note with interest. 5 Record the payment of note with interest. 6 Record the borrowing of cash with a 120-day note. 7 Record the accrued interest on note payable. 8 Record the payment of note with interest.

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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Zing Cell Phone Company entered into the following transactions involving current liabilities during 2020 and 2021.

	2020
Mar.	14	Purchased merchandise on credit from Ferris Inc. for $160,000. The terms were 1/10, n/30 (assume a perpetual inventory system).
Apr.	14	Zing paid $35,000 cash and replaced the $125,000 remaining balance of the account payable to Ferris Inc. with a 6%, 60-day note payable.
May	21	Borrowed $135,000 from Scotiabank by signing a 5.5%, 90-day note.
	?	Paid the note to Ferris Inc. at maturity.
	?	Paid the note to Scotiabank at maturity.
Dec.	15	Borrowed $110,000 and signed a 6.25%, 120-day note with National Bank.
Dec.	31	Recorded an adjusting entry for the accrual of interest on the note to National Bank.
	2021
	?	Paid the note to National Bank at maturity.

Required:
1. Determine the maturity dates of the three notes just described.

2. Present journal entries for each of the preceding dates. (Use 365 days an year. Do not round intermediate calculations and round the final answers to 2 decimal places.)

Record the purchase of merchandise on credit
2

Record the payment of cash and a note written to extend due date.
3

Record the borrowing of cash with a 90-day against note.
4

Record the payment of note with interest.
5

Record the payment of note with interest.
6

Record the borrowing of cash with a 120-day note.
7

Record the accrued interest on note payable.
8

Record the payment of note with interest.

Zing Cell Phone Company entered into the following transactions involving current liabilities during 2020 and 2021.
2020
Mar.
14 Purchased merchandise on credit from Ferris Inc. for $160,000. The terms
were 1/10, n/30 (assume a perpetual inventory system).
14 Zing paid $35,000 cash and replaced the $125,000 remaining balance of the account
payable to Ferris Inc. with a 6%, 60-day note payable.
21 Borrowed $135,000 from Scotiabank by signing a 5.5%, 90-day note.
? Paid the note to Ferris Inc. at maturity.
? Paid the note to Scotiabank at maturity.
15 Borrowed $110,000 and signed a 6.25%, 120-day note with National Bank.
31 Recorded an adjusting entry for the accrual of interest on the note to National Bank.
2021
Apr.
Мay
Dec.
Dec.
Paid the not
to National Bank
maturity.
Required:
1. Determine the maturity dates of the three notes just described.
Ferris Inc.
Scotiabank
National Bank
Maturity date

2. Present journal entries for each of the preceding dates. (Use 365 days an year. Do not round intermediate calculations and round
the final answers to 2 decimal places.)
View transaction list
>
Record the purchase of merchandise on credit.
2
Record the payment of cash and a note written to extend
due date.
Record the borrowing of cash with a 90-day against note.
4
Record the payment of note with interest.
Credit
Record the payment of note with interest.
6.
Record the borrowing of cash with a 120-day note.
7
Record the accrued interest on note payable.
Note :
journal entry has been entered
%D
Record entry
Clear entry
View general journal
EX:

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