Date Face Amount Term İnterest Rate 1. Mar. 6 $75,000 60 days 4% 2. Apr. 7 40,000 45 days 6% 3. Aug. 12 36,000 120 days 5% 4. Oct. 22 27,000 30 days 8% 5. Nov. 19 48,000 90 days 3% 6. Dec. 15 72,000 45 days 5% Required: 1. Determine for each note (a) the due date and (b) the amount of interest due at maturity, identifying each note by number. Assume a 360-day year. 2. Journalize the entry to record the dishonor of Note (3) on its due date. Refer to the Chart of Accounts for exact wording of account titles. 3. Journalize the adjusting entry to record the accrued interest on Notes (5) and (6) on December 31. Refer to the Chart of Accounts for exact wording of account titles. Assume a 360-day year. 4. Journalize the entries to record the receipt of the amounts due on Notes (5) and (6) in January and February. Refer to the Chart of Accounts for exact wording of account titles.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter12: Current Liabilities
Section: Chapter Questions
Problem 11EA: Use information from EA10. Compute the interest expense due when Barkers honors the note. Show the...
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Question
Date
Face Amount
Term
Interest Rate
1.
Mar. 6
$75,000
60 days
4%
2.
Apr. 7
40,000
45 days
6%
3.
Aug. 12
36,000
120 days
5%
4.
Oct. 22
27,000
30 days
8%
5.
Nov. 19
48,000
90 days
3%
6.
Dec. 15
72,000
45 days
5%
Required:
1. Determine for each note (a) the due date and (b) the amount of interest due at maturity, identifying each note by number. Assume a 360-day
year.
2. Journalize the entry to record the dishonor of Note (3) on its due date. Refer to the Chart of Accounts for exact wording of account titles.
3. Journalize the adjusting entry to record the accrued interest on Notes (5) and (6) on December 31. Refer to the Chart of Accounts for exact
wording of account titles. Assume a 360-day year.
4. Journalize the entries to record the receipt of the amounts due on Notes (5) and (6) in January and February. Refer to the Chart of Accounts
for exact wording of account titles.
Transcribed Image Text:Date Face Amount Term Interest Rate 1. Mar. 6 $75,000 60 days 4% 2. Apr. 7 40,000 45 days 6% 3. Aug. 12 36,000 120 days 5% 4. Oct. 22 27,000 30 days 8% 5. Nov. 19 48,000 90 days 3% 6. Dec. 15 72,000 45 days 5% Required: 1. Determine for each note (a) the due date and (b) the amount of interest due at maturity, identifying each note by number. Assume a 360-day year. 2. Journalize the entry to record the dishonor of Note (3) on its due date. Refer to the Chart of Accounts for exact wording of account titles. 3. Journalize the adjusting entry to record the accrued interest on Notes (5) and (6) on December 31. Refer to the Chart of Accounts for exact wording of account titles. Assume a 360-day year. 4. Journalize the entries to record the receipt of the amounts due on Notes (5) and (6) in January and February. Refer to the Chart of Accounts for exact wording of account titles.
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