Baltimore Company issued a $9,000 face value discount note to Bank of the Chesapeake on March 1, Year 1. The note had a 5% discount rate and a one-year term tomaturity.How would the adjustment to record interest expense on December 31, Year 1 affect the financial statements?Balance SheetIncome StatementStockholders'a.Assetsn/a= Liabilities +EquityRevenueExpense=Net IncomeStatement of Cash Flows375(375)n/a375(375)n/ab.n/a450(450)n/a450(450)C.(375)n/a(375)n/a375(375)n/a(375) OAd.(450)(450)n/an/an/an/a(450) OA

The adjustment to record interest expense on December 31, Year 1, would affect the financial…

Answered: Baltimore Company issued a $9,000 face…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A Company provided the following account balances on December 31, 2021: Financial assets at FVTOCI 300,000 Cash in bank (net of bank overdraft of P100,000) 500,000 Petty cash fund 40,000 Inventory (including inventory out on consignment amounting P50,000) 200,000 Financial assets at amortized cost/held to maturity 600,000 Accounts receivable 2,100,000 Undeposited collections (including P10,000 customer’s check return, DAIF) 100,000 Allowance for uncollectible accounts 200,000 Trade installment accounts receivable, including P60,000 due after a year 145,000 Cash surrender value of life insurance 50,000 Prepaid expenses 200,000 Equipment and furniture 1,300,000 Accumulated depreciation 700,000 Patent 300,000 Accumulated amortization 20,000 [Q2]: Determine total amount of (5) current assets and (6) non-current assets on December 31, 2021.
Assuming a 360-day year, proceeds of $43,722 were received from discounting a $44,958, 90-day note at a bank. The discount rate used by the bank in computing the proceeds was O a. 12.24% b. 11.00% c. 9% Od. 12.75%
The following transactions apply to Hooper Co. for Year 1, its first year of operations: 1. Issued $130,000 of common stock for cash. 2. Provided $100,000 of services on account. 3. Collected $88,000 cash from accounts receivable. 4. Loaned $11,000 to Mosby Co. on November 30, Year 1. The note had a one-year term to maturity and a 6 percen interest rate. 5. Paid $34,000 of salaries expense for the year. 6. Paid a $2,000 dividend to the stockholders. 7. Recorded the accrued interest on December 31, Year 1 (see item 4). 8. Estimated that 1 percent of service revenue will be uncollectible. Problem 5-26A (Algo) Part b b. Prepare the income statement, balance sheet, and statement of cash flows for Year 1.
L. How much interest income should be reported on December 31, 2020 with regards to the note from Company B? 2-2 Notes Receivables The trial balance for BLUE Corporation prepared at December 31, 2020 showed a balance of P4,000,000 for Notes Receivables broken as follows: Notes receivable from Company A Notes receivable from Company B 3,000,000 1,000,000 Total 4,000,000 Additional information: The notes receivable from Company A is a three-year non- interest bearing note, with face value of P3,000,000. The note was received in exchange for a piece of land sold by BLUE on May 1, 2020. The land was carried in the books at the date of sale at P2,600,000. The difference between the face amount of the note and the carrying value of the land was credited to gain on sale of land. The market interest rate for a note of this type is 10%. The notes receivable from Company B bears interest at 10%. The note was received from sale of goods in the normal course of business. The note is dated October…
LO 8-3 E8-10 Recording Notes Receivable Transactions, Including Accrual Adjustment for Interest domic The following transactions took place for Smart Solutions Inc. 2020 a. July 1 b. Dec. 31 2021 c. July 1 250 06 Loaned $70,000 to employees of the company and received back one-year, 10 percent notes. shunt at las Accrued interest on the notes. d. July 1 berupa wollReceived interest on the notes. (No interest has been recorded since December 31.) ele St Received principal on the notes. noxidoa bed to Jouons tedW oli ni songly Bubanu adi 11 sqx mis bs& lo tuoms isrw Required: Prepare the journal entries that Smart Solutions Inc. would record for the above transactions.
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Assuming a 360-day year, proceeds of $45,552 were received from discounting a $46,830, 90-day note at a bank. The discount rate used by the bank in computing the proceeds was а. 12.16% b. 12.67% C. 8.92% Od. 10.92%
Assuming a 360-day year, proceeds of $46,510 were received from discounting a $47,941, 90-day note at a bank. The discount rate used by the bank in computing the proceeds was a.13.18% b.13.69% c.9.94% d.11.94%
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On August 1, 2022, Colombo Company’s treasurer signed a note promising to pay $122,700 on December 31, 2022. The proceeds of the note were $116,100. Use the horizontal model to show the effects of recording interest expense for the month of September. Indicate the financial statement effect. What is the discount on notes payable and what is the interest expense?
Following are the balances of Bank Muscat for the year ended as on 31st December 2020 (Amounts are in 000’ OMR) PARTICULARS OMR Interest on Savings Account 6,000 Interest on Fixed Deposits 33,000 Interest on Loans 19,200 Rent and Rates 1,500 Interest on Current Account 4,500 Interest on Cash Credits 16,800 Discounts received 21,000 Commission Expenses 600 Commission Received 2,400 Director’s Fees 150 Salaries and Allowances 6,000 Interest on Overdrafts 18,000 Interest on borrowings from other banks 1,500 Legal Charges 90 Transfer Fees paid 1,200 Locker Rent 1,800 Other office expenses 120 Depreciation on Fixed Assets 6,000 Miscellaneous Expenses 1,200 Other Adjustments: Fair value of sale of investments were increased by: OMR 3,600 Loss on exchange difference arising on transactions of foreign operations was: OMR 600 Income tax expenses: OMR 9,000…

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