b. What amount of cash was paid for interest in Year 1?c. Use a horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cashflows. Indicate whether the event increases (I) or decreases (D) each element of the financial statements. Leave cell blank to indicateno effect. Also, in the Statement of Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), orfinancing activities (FA). The first transaction has been recorded as an example.Complete this question by entering your answers in the tabs below.Req A and BReq CUse a horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. Indicate(I) or decreases (D) each element of the financial statements. Leave cell blank to indicate no effect. Also, in the Statement of Cash Flows columas operating activities (OA), investing activities (IA), or financing activities (FA). The first transaction has been recorded as an example.BRADLEY COMPANYStatements Model for Year 1Balance SheetIncome StatementAssetsLiabilities+Stockholders' EquityRevenue - Expenses=NetIncomeStatement of CashFlowsRetainedCommonStockEventNotesInterestCashPayablePayableEarningsNo.OA%3D+2= D%3D< Req A and BReg C>tvMacBook Pro.... Ben Bradley started Bradley Company on January 1, Year 1. The company experienced the following events during its first year ofoperation:1. Earned $3,500 of cash revenue for performing services.2. Borrowed $5,000 cash from the bank.3. Adjusted the accounting records to recognize accrued interest expense on the bank note. The note, issued on August 1, Year 1, hada one-year term and a 6 percent annual interest rate.Requireda. What is the amount of interest expense in Year 1?b. What amount of cash was paid for interest in Year 1?c. Usea horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cashflows.indicate whether the event increases (I) or decreases (D) each element of the financial statements. Leave cell blank to indicateno effect. Also, in the Statement of Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), orfinancing activities (FA). The first transaction has been recorded as an example.Complete this question by entering your answers in the tabs below.Req A and BReq CWhat is the amount of interest expense in Year 1? (Do not round intermediate calculations.)What amount of cash was paid for interest in Year 1?a. Interest expenseb.Interest paymentWtvMacBook Pro

a. Interest expense for the year= $5000×6%×512=$125 b. Interest paid= 0, no interest has been…

Ben Bradley started Bradley Company on January 1, Year 1. The company experienced the following events during its first year of operation: 1. Earned $3,500 of cash revenue for performing services. 2. Borrowed $5,000 cash from the bank. 3. Adjusted the accounting records to recognize accrued interest expense on the bank note. The note, issued on August 1, Year 1, had a one-year term and a 6 percent annual interest rate. Required a. What is the amount of interest expense in Year 1? b. What amount of cash was paid for interest in Year 1? c. Usera horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cash flows.indicate whether the event increases (I) or decreases (D) each element of the financial statements. Leave cell blank to indicate no effect. Also, in the Statement of Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). The first transaction has been recorded as an example.

Ben Bradley started Bradley Company on January 1, Year 1. The company experienced the following events during its first year of operation: 1. Earned $3,500 of cash revenue for performing services. 2. Borrowed $5,000 cash from the bank. 3. Adjusted the accounting records to recognize accrued interest expense on the bank note. The note, issued on August 1, Year 1, had a one-year term and a 6 percent annual interest rate. Required a. What is the amount of interest expense in Year 1? b. What amount of cash was paid for interest in Year 1? c. Usera horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cash flows.indicate whether the event increases (I) or decreases (D) each element of the financial statements. Leave cell blank to indicate no effect. Also, in the Statement of Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). The first transaction has been recorded as an example.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 22MC: A company collects an honored note with a maturity date of 24 months from establishment, a 10%...

See similar textbooks

Similar questions

On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.
Dan Dayle started a business by issuing an $92,000 face value note to First State Bank on January 1, Year 1. The note had a 7 percent annual rate of interest and a five-year term Payments of $22,438 are to be made each December 31 for five years. Required: a. What portion of the December 31, Year 1. payment is applied to interest expense and principal? b. What is the principal balance on January 1, Year 2? c. What portion of the December 31, Year 2, payment is applied to interest expense and principal? Note: Round your answers to the nearest dollar amount. a. Interest expense a. Principal b. Principal balance c. Interest expense c. Principal
abardeen corporation borrowed 58,000 from the bank on october 1, year 1. The note had a 4 percent annual rate of interest and matured on march 31, year 2. interest and principal were paid in cash on the maturity date. a. what amount of cash did abardeen pay for interest in year 1? b. what amount of interest expense was recognized on the year 1 income statement? c. what amount of total liabilities was reported on december 31, year 1, balance sheet?
Leach Company borrowed $95,000 cash by issuing a note payable on June 1, Year 1. The note had an 6 percent annual rate of interest and a one-year term to maturity. Required: a. What amount of interest expense will Leach recognize for the year ending December 31, Year 1? b. Record the issue of notes payable and recognition of interest on December 31, Year 1, in the accounting equation for Year 1. c. What amount of cash will Leach pay for interest expense in Year 1? d. What is the amount of interest payable as of December 31, Year 1? e. What amount of cash will Leach pay for interest expense in Year 2? f. What amount of interest expense will Leach recognize in Year 2? g. What is the amount of interest payable as of December 31, Year 2? -
Abardeen Corporation borrowed $105,000 from the bank on October 1, Year 1. The note had an 4 percent annual rate of interest and matured on March 31, Year 2. Interest and principal were paid in cash on the maturity date. Required a. What amount of cash did Abardeen pay for interest in Year 1? b. What amount of interest expense was recognized on the Year 1 income statement? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) c. What amount of total liabilities was reported on the December 31, Year 1, balance sheet? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) d. What total amount of cash was paid to the bank on March 31, Year 2, for principal and interest? e. What amount of interest expense was reported on the Year 2 income statement? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) a. Amount of cash paid b. Interest expense c. Total liabilities d. Amount of cash…
Abardeen Corporation borrowed $105,000 from the bank on October 1, Year 1. The note had an 4 percent annual rate of interest and matured on March 31, Year 2. Interest and principal were paid in cash on the maturity date. Required a. What amount of cash did Abardeen pay for interest in Year 1? b. What amount of interest expense was recognized on the Year 1 income statement? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) c. What amount of total liabilities was reported on the December 31, Year 1, balance sheet? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) d. What total amount of cash was paid to the bank on March 31, Year 2, for principal and interest? e. What amount of interest expense was reported on the Year 2 income statement? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) a. Amount of cash paid $ b. Interest expense $ 1,050 Total liabilities $ 106,050 C.…
Abardeen Corporation borrowed $85,000 from the bank on October 1, Year 1 . The note had an 10 percent annual rate of interest and matured on March 31, Year 2 Interest and principal were paid in cash on the maturity date. Required a. What amount of cash did Abardeen pay for interest in Year 1?
Abardeen Corporation borrowed $118,000 from the bank on October 1, Year 1. The note had an 6 percent annual rate of interest and matured on March 31, Year 2. Interest and principal were paid in cash on the maturity date. Required a. What amount of cash did Abardeen pay for interest in Year 1? b. What amount of interest expense was recognized on the Year 1 income statement? Note: Do not round intermediate calculations. Round your answer to the nearest dollar amount. c. What amount of total liabilities was reported on the December 31, Year 1, balance sheet? Note: Do not round intermediate calculations. Round your answer to the nearest dollar amount. d. What total amount of cash was paid to the bank on March 31, Year 2, for principal and interest? e. What amount of interest expense was reported on the Year 2 income statement? Note: Do not rbund intermediate calculations. Round your answer to the nearest dollar amount. a. Amount of cash paid b. Interest expense c. Total liabilities d.…
Keesha Company borrows $250,000 cash on December 1 of the current year by signing a 120-day, 11%, $250,000 note. 1. On what date does this note mature? 2. & 3. What is the amount of interest expense in the current year and the following year from this note? 4. Prepare journal entries to record (a) issuance of the note, (b) accrual of interest on December 31, and (c) payment of the note at maturity.
abardeen corporation borrowed 58,000 from the bank on october 1, year 1. the note had a 4 percent annual rate of interest and matured on march 31, year 2. interest and principal were paid in cash on the maturity date. d. what total amount of cash was paid to the bank on march 31, year 2, for principle and interest? e. what amount of interest expense was reported on the year 2 income statement?
Abardeen Corporation borrowed $147,000 from the bank on October 1, Year 1. The note had an 8 percent annual rate of interest and matured on March 31, Year 2. Interest and principal were paid in cash on the maturity date: Required a. What amount of cash did Abardeen pay for interest in Year 1? b. What amount of interest expense was recognized on the Year 1 income statement? (Do not round intermediate calculations. Rounc your answer to the nearest dollar amount.) c. What amount of total liabilities was reported on the December 31, Year 1. balance sheet? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) d. What total amount of cash was paid to the bank on March 31. Year 2, for principal and interest? e. What amount of interest expense was reported on the Year 2 income statement? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.) Löö a. Amount of cash paid Interest expense b. c. Total liabilities d. Amount of…
Anne Taylor Company borrowed cash on August 1 of Year 1, by signing a $19,980 (face amount), one-year note payable, due on July 31 of Year 2. The accounting period of Anne Taylor ends December 31. Assume an effective interest rate of 11%. a. How much cash should Anne Taylor Company receive from the note on August 1 of Year 1, assuming the note is an interest-bearing note? $ 0 b. Provide the following entries and reporting amounts: 1. August 1 of Year 1, date of the loan. 2. December 31 of Year 1, adjusting entry. 3. July 31 of Year 2, payment of the note. ⚫Note: Round your answers to the nearest whole dollar. Date 1. Aug. 1, Year 1 Account Name Dr. Cr. 0 0 0 0 To record issue of note. 2. Dec. 31, Year 1 0 0 To record year-end adjusting entry. 3. July 31, Year 2 0 O O 0 0 0 0 0 0 0 00 0 0 To record payment of note. c. What liability amounts should be shown on the December 31 of Year 1 balance sheet? Balance Sheet, Dec. 31 Year 1 Current liabilities Note Payable 0 $ 0 d. Answer (a) and…