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a. Paid P24,000 for a 1-year fire insurance policy to commence on Sept. 1. The amount of premium was debited to Prepaid Insurance. 8,000 * Your answer b. Borrowed P100,000 by issuing a 1-year note with 7% annual interest to Ajeno Savings Bank on Oct. 1. Principal and interest will be paid after 1-year. * Your answer c. Paid P160,000 cash to purchase a delivery van (surplus) on Jan. 1. The van was expected to have a 3-year life and a P10,000 salvage value. Depreciation is computed on a straight-line basis.

a. Paid P24,000 for a 1-year fire insurance policy to commence on Sept. 1. The amount of premium was debited to Prepaid Insurance. 8,000 * Your answer b. Borrowed P100,000 by issuing a 1-year note with 7% annual interest to Ajeno Savings Bank on Oct. 1. Principal and interest will be paid after 1-year. * Your answer c. Paid P160,000 cash to purchase a delivery van (surplus) on Jan. 1. The van was expected to have a 3-year life and a P10,000 salvage value. Depreciation is computed on a straight-line basis.

College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter17: Accounting For Notes And Interest
Section: Chapter Questions
Problem 2CE
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6:04 PM A i all a 65 docs.google.com/forms/d/e/1FA a. Paid P24,000 for a 1-year fire insurance policy to commence on Sept. 1. The amount of premium was debited to Prepaid Insurance. 8,000 * Your answer b. Borrowed P100,000 by issuing a 1-year note with 7% annual interest to Ajeno Savings Bank on Oct. 1. Principal and interest will be paid after 1-year. Your answer c. Paid P160,000 cash to purchase a delivery van (surplus) on Jan. 1. The van was expected to have a 3-year life and a P10,000 salvage value. Depreciation is computed on a straight-line basis. * Your answer
Transcribed Image Text:6:04 PM A i all a 65 docs.google.com/forms/d/e/1FA a. Paid P24,000 for a 1-year fire insurance policy to commence on Sept. 1. The amount of premium was debited to Prepaid Insurance. 8,000 * Your answer b. Borrowed P100,000 by issuing a 1-year note with 7% annual interest to Ajeno Savings Bank on Oct. 1. Principal and interest will be paid after 1-year. Your answer c. Paid P160,000 cash to purchase a delivery van (surplus) on Jan. 1. The van was expected to have a 3-year life and a P10,000 salvage value. Depreciation is computed on a straight-line basis. * Your answer
6:04 PM A ll d. Received an P18,000 cash advance for a contract to provide services in the future. the contract required a 1-year commitment, starting Apr. 1. * Your answer e. Purchased P6,400 of supplies on account. At year-end, P750 of supplies remained on hand. * Your answer f. Invested P90,000 cash in certificate of deposit that paid 4% annual interest. the certificate was acquired on May 1 and carried a 1-year-term to maturity. Principal and interest will be paid after 1- year. Your answer g. Paid P78,000 cash in advance on Sept. 1 for a 1-year lease of the office space.
Transcribed Image Text:6:04 PM A ll d. Received an P18,000 cash advance for a contract to provide services in the future. the contract required a 1-year commitment, starting Apr. 1. * Your answer e. Purchased P6,400 of supplies on account. At year-end, P750 of supplies remained on hand. * Your answer f. Invested P90,000 cash in certificate of deposit that paid 4% annual interest. the certificate was acquired on May 1 and carried a 1-year-term to maturity. Principal and interest will be paid after 1- year. Your answer g. Paid P78,000 cash in advance on Sept. 1 for a 1-year lease of the office space.
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