On June 1, Davis Inc. issued an $89,300, 8%, 120-day note payable to Garcia Company. Assume that the fiscal year of Garcia ends June 30. Using a 360-day year, what isthe amount of interest revenue recognized by Garcia in the following year? When required, round your answer to the nearest dollar.a. $1,806Ob. $7,144O c. $595Od. $1,191B

Answer : Interest revenue recognized in the following year = $89,300 * 8% * 91/360 Interest revenue…

Answered: Inc. issued ar а Cerest revenu

Business

Accounting

Inc. issued ar а Cerest revenu

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 1EB: Everglades Consultants takes out a loan in the amount of $375,000 on April 1. The terms of the loan...

See similar textbooks

Related questions

Q: s to open a sports bar. If she qualifies for a $250,225 simple discount note at 9% for 280 days,…

A: Answer : Amount = $250,225 Rate = 9% Days=280

Q: Lon Timur is an accounting major at a midwestern state university located approximately 60 miles…

A: Net income refers to the amount an individual or business makes after deducting costs , allowances…

Q: JAT is finalizing the ending inventory balance. The following information has been collected: a. The…

A: Ending Inventory Rectification The final value of the ending inventory for the financial statement…

Q: applies to the questions displayed below] Warnerwoods Company uses a perpetual inventory system. It…

A: Computation of cost assigned to ending inventory using FIFO : Perpetual FIFO: Goods Purchased…

Q: The condensed product-line income statement for Rhinebeck Company for the month of October is as…

A: Solution:-a Preparation of a differential analysis dated October 31 to determine if Mufflers should…

Q: Compute the activity rates for each of the three cost pools.

A: Activity Cost Pools Activity Driver Assembling products assembly hours Designing products…

Q: 8. Carousel Co. has prepared the following budget data: Sales, 150,000 units; selling price per…

A: "Since you have asked multiple questions, we will solve first question for you. If you want any…

Q: When bonds are retired at maturity, the entry to retire the bonds may include a gain or loss on…

A: Option 2 is the appropriate choice.

Q: On December 29, Patel Products, Incorporated, sells a delivery van that cost $20,000. After…

A: Accumulated depreciation is the cumulative balance of the depreciation expense which is shown in the…

Q: Under the equity method, the investor

A: Investment shows the amount provided in a project or securities with the expectation of something in…

Q: 3. Under full costing method, what would be the company's value of finished goods ending inventory,…

A: 1. Valuation of Inventory under full costing method: Full costing, or absorption costing, accounts…

Q: please take below trial balance information for january 2020, conver it into financial statements.…

A: In case of multiple subparts, we are allowed to solve only the first three subparts. If you want…

Q: Exercise 22-22A (Algo) Assigning joint costs LO C2 Home Properties is developing a subdivision that…

A: Lets understand the basics. When two or more products gets produce from single pool of expense then…

Q: At December 31, 2020, the balance sheet of Meca International Included the following shareholders'…

A: Equity held by shareholders is the sum that a company's founders have contributed to the enterprise.…

Q: Jim used the actual expense method of determining his Home Office deduction last year and was…

A: If a person is using a property for both residence and business, he shall be eligible for a home…

Q: Taxes (LO 5.7) Lyndon's employer withheld $8,700 in state income taxes from Lyndon's wages in 2021.…

Q: Questions: 1 How much is the adjusted net income in 2021? subpart: 1.1 How much is the adjusted…

A: The statement of retained earnings means the undistributed part of the company's earnings. The…

Q: Solstice Company determines on October 1 that it cannot collect $54,000 of its accounts receivable…

A: The journal entries are prepared to keep the record of day to day transactions of the business on…

Q: the first interest payment on June 30, 2025, what is the balance of Discount on Bonds Payable?…

A: Discount on bond Payable means the bond issued at a less amount from its face value. The journal…

Q: Pat Lavoie bought a home for $180,000 with a down payment of $10,000. Her rate of interest is 6% for…

A: The amount that must be paid toward the loan each month in order to completely repay it within the…

Q: Read Section 1374 for built-in-gain tax 1. When does the tax apply?

A: The answer for the question on the Section 1374 for built - in - gain tax is given hereunder :…

Q: NoNuns Cos. has a 20 percent tax rate and has $305,600,000 in assets, currently financed entirely…

A: Break Even Level of EBIT = Total Assets * Debt ratio * Interest Rate on Debt

Q: Legacy issues $740,000 of 7.5%, four-year bonds dated January 1, 2021, that pay interest…

A: Bonds are issued by governments and corporations when they want to raise money. By buying a bond,…

Q: U3 Company is considering three long-term capital investment proposals. Each investment has a useful…

A: The difference between the present value of cash inflows and the present value of cash outflows over…

Q: Audrey volunteer at the homeless shelter, she worked 279 days during the year, she was required to…

A: Charitable contribution deduction is allowed to save tax on total taxable income. Any amount paid…

Q: In 1982, the average price of a new car sold in Canada was $10,668. By 2009, the average price of a…

A: An increase in prices can be due to inflation. The average annual rate of change in car prices is…

Q: departments (Assembly and Finishing) and two service departments (HRD & Janitorial). The projected…

A: Lets understand the basics. In direct method, cost of service department allocated to production…

Q: On July 1, 2024, Mason & Beech Services issued $42,000 of 8% bonds that mature in five years. They…

A: The correct answer is: (B) $1,680 The bonds are issued not at the beginning of the year but rather…

Q: Sales Variable Expenses P 450,000 P 360,000 P 50,000 P 20,000 Lablab expects to have a total of…

A: Calculation of break even point in case of multiple products (Product mix): 1. The sales mix is a…

Q: In Complete Liquidation of her Partnership Interest, Rose receives $60,000 in Cash and Unrealized…

A: The liquidation of the partnership means the end of the partnership between the partners. In the…

Q: Gardens, Inc. invests its excess cash in Innovative Technologies, Inc. and acquires 2,700 shares for…

A: As per the rule of Accounting, assets and expenses are debited when they increased and credited when…

Q: Bett Inc. has the following 8 units A-H Description A B Assets 50 70 Revenue Profit Units 7 C 40 650…

A: A entity should report all the segments which has at least 10℅ of revenue, or 10℅ of profit or…

Q: 22. for 2021, Forrway corporation, an accrual basis calendar year corporation, had net income per…

A: Calculation of Taxable income of Forrway for Tax year 2021

Q: 11. Assume that the company uses direct method of allocation, how much is the amount of custodial…

A: Meaning of direct cost allocation method In this method amount of service department are transferred…

Q: Which one of the following is a principal function of the statement of cash flows? a. To predict…

A: Statement of cash flows is the part of financial statements which is used to see the cash movement…

Q: In order to determine whether or not a trial balance is complete, why is it not sufficient to verify…

A: Introduction:- The main purpose of a trial balance is to make sure that all entries made into…

Q: Legacy issues $740,000 of 7.5%, four-year bonds dated January 1, 2021, that pay interest…

A: Bonds are not always issued at par. If the stated rate of the bond is less than the market rate,the…

Q: Phoenix Company is considering investments in projects C1 and C2. Both require an initial investment…

A: Net Present Value=(Present Value of Cash Inflows-Present Value of Cash Outflows) IRR is a rate at…

Q: follows: Quickies Services, Inc. shows the following estimated operating statistics for this year:…

Q: Wheat Corporation pays $524,000 to acquire 44% (100,000 shares) of the common stock of Grain…

A: Journal entries are the primary reporting of the business transactions in the books of accounts. It…

Q: On January 1, 2025, Taylor Accounting Services issued $53,000 of 6% bonds that mature in five years.…

A: Interest payment on the bonds is calculated by multiplying the stated rate with the face or par…

Q: Following is information on an investment in a manufacturing machine. The machine has zero salvage…

A: INTRODUCTION The Net Present Value is the present value of all future cash flows from a project…

Q: Financial Statement Prepare a statement of revenues, expenditures, and changes in fund balance for…

A: Statement of revenue and expenditure: The statement of revenue and expenditure is similar to the…

Q: John filed his 2021 income tax return on December 20, 2022, paying the $10,000 amount due at that…

A: A tax return is the form which is to be submitted to a taxing body that includes all the details…

Q: 5- If the Excess cost over the book value was $190,000, assuming the inventory undervalued by…

A: Goodwill is an intangible asset associated with the purchase of one company by another. There are…

Q: Desmond is 25 years old, and he participates in his employer’s 401(k) plan. During the year, he…

A: The amount you make over the course of a fiscal year before any deductions is your yearly gross…

Q: [The following information applies to the two next questions. Suppose that you buy an office…

A: As per federal tax laws a commercial property can be depreciated for a period of 39 years on a…

Q: Which of the following represents one of the basic rights of stockholders? a. Stockholders may sell…

A: One of the basic rights of stockholders is "Stockholders may participate in management by voting on…

Q: What is the value of assets if: Liabilities = R50,000 and Capital = R10,000

A: Lets understand the basics. As per balance sheet equation, total assets is always equal to total…

Q: Concord Inc. initiated a major company expansion on January 4, 2025. During the first quarter of…

A: Tangible assets are the resources that an entity owns and uses for the purpose of generating…

Question

On June 1, Davis Inc. issued an $89,300, 8%, 120-day note payable to Garcia Company. Assume that the fiscal year of Garcia ends June 30. Using a 360-day year, what is
the amount of interest revenue recognized by Garcia in the following year? When required, round your answer to the nearest dollar.
a. $1,806
Ob. $7,144
O c. $595
Od. $1,191
B

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

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.
Jain Enterprises honors a short-term note payable. Principal on the note is $425,000, with an annual interest rate of 3.5%, due in 6 months. What journal entry is created when Jain honors the note?
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. Refer to RE6-10. On December 31, Jordan Inc. received 50,000 on assigned accounts. Prepare Jordans journal entries to record the cash receipt and the payment to McLaughlin.
Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?
A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest Expense
Everglades Consultants takes out a loan in the amount of $375,000 on April 1. The terms of the loan include a repayment of principal in eight, equal installments, paid annually from the April 1 date. The annual interest rate on the loan is 5%, recognized on December 31. (Round answers to the nearest cent, if needed.) A. Compute the interest recognized as of December 31 in year 1. B. Compute the principal due in year 1.
On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank. The note has a face value of 15,000 and a maturity value (principal plus interest) of 15,400. The discount is calculated to be 385, and the accrued interest income is 100. The recourse liability is estimated to be 1,000. Prepare the journal entry of Phillips to record the sale of the note receivable.
Anderson Air is a customer of Handler Cleaning Operations. For Anderson Airs latest purchase on January 1, 2018, Handler Cleaning Operations issues a note with a principal amount of $1,255,000, 6% annual interest rate, and a 24-month maturity date on December 31, 2019. Record the journal entries for Handler Cleaning Operations for the following transactions. A. Entry for note issuance B. Subsequent interest entry on December 31, 2018 C. Honored note entry at maturity on December 31, 2019