E9.16 (Purchase of Computer with Zero - Interest - Bearing Debt) Cardinals Corporation purchased a computer on December 31, 2024, for $105,000, paying $30,000 down and agreeing to pay the balance in five equal installments of $15,000 payable each December 31 beginning in 2025. An assumed interest rate of 10% is implicit in the purchase price. Instructions (Round to two decimal places) a. Prepare the journal entry (entries) at the date of purchase. b. Prepare the journal entry (entries) at December 31, 2025, to record the payment and interest (effective interest method employed). c. Prepare the journal entry (entries) at December 31, 2026, to record the payment and interest (effective - interest method employed).

E9.16 (Purchase of Computer with Zero - Interest - Bearing Debt) Cardinals Corporation purchased a computer on December 31, 2024, for $105,000, paying $30,000 down and agreeing to pay the balance in five equal installments of $15,000 payable each December 31 beginning in 2025. An assumed interest rate of 10% is implicit in the purchase price. Instructions (Round to two decimal places) a. Prepare the journal entry (entries) at the date of purchase. b. Prepare the journal entry (entries) at December 31, 2025, to record the payment and interest (effective interest method employed). c. Prepare the journal entry (entries) at December 31, 2026, to record the payment and interest (effective - interest method employed).

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 12P: Hamlet Corporation purchases computer equipment at a price of 100,000 on January 1, 2019, paying...

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