FINANCIAL ACCOUNTING
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ISBN: 9781259964947
Author: Libby
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Transcribed Image Text:Entries for Discounted Note Payable
A business issued a 60-day note for $60,000 to a bank. The note was discounted at 8%. Assume a 360-day year.
a. Journalize the entry to record the issuance of the note. For a compound transaction, if an amount box does not require an entry, leave it blank.
Cash ✔
0✔
Interest Expense✔
Notes Payable ✔
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0
0
0
600,000 X
Check My Work
a. Why is the company issuing the note? What type of note is being issi
(interest-bearing or discounted)? Hot much will the company owe on the maturity date?
b. Journalize the entry to record the payment of the note at maturity. If an amount box does not require an entry, leave it blank.
Notes Payable ✓✔
0 ✓
Cash
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