INTER. ACCOUNTING - CONNECT+ALEKS ACCESS
10th Edition
ISBN: 9781264770335
Author: SPICELAND
Publisher: MCG
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Planning Wizards, LLC is an event-planning company. Which of the following would be included in the current asset section of a classified balance sheet dated December 31, 2019? a. 15-month certificate of deposit b. Customer advances on New Year's parties c. Last month rent payment (lease expires in 2021) d. Investment in stocks, to be sold in 2020 e. Income tax refund receivable f. Inventory Select one: d, e, and f e and f a, b, c, e, and f a, b, c, d, e, and f b, e, f
On January 1, 2019, Northern Manufacturing Company bought a piece of
equipment by signing a non-interest-bearing $80,000, 1-year note. The
face value of the note includes the price of the equipment and the interest.
The effective interest rate is an annual rate of 16%, and the note is to be
paid in four $20,000 quarterly installments on March 31, June 30,
September 30, and December 31. The price of the equipment is the
present value of the four payments discounted at the effective interest
rate.
The following selected transactions were completed by Zippy Do Co., a supplier of zippers for
clothing:
2019
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Mar. 2 Received payment of note and interest from Chicago Clothing & Bags Co.
Journalize the entries to record the transactions. If no entry is required, simply skip to the next
transaction. Be sure to include the year in the date for the entries.
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Page 10
Accounting 1A
Class Assignment
Chapter 8-Receivables
Received from Chicago Clothing & Bags Co., on account, a $36,000, 90-day,
6% note dated December 3.
Recorded an adjusting entry for accrued interest on the note of December 3.
Recorded the closing entry for interest revenue.
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