FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:Concord Corporation purchased a computer on December 31, 2024, for $115,500, paying $33,000 down and agreeing to pay the
balance in five equal installments of $16,500 payable each December 31 beginning in 2025. An assumed interest rate of 10% is
implicit in the purchase price.
Prepare the journal entry at December 31, 2025, to record the payment and interest (effective-interest method employed).
(Round answers to 2 decimal places, e.g. 52.75. Credit account titles are automatically indented when amount is entered. Do not indent
manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit
entries.)
Date
Account Titles and Explanation
c. 31, 2025
Interest Expense
Notes Payable
Cash
Discount on Notes Payable
Debit
6600
16,500
Credit
6600
16500
Prepare the journal entry at December 31, 2026, to record the payment and interest (effective-interest method employed).
(Round answers to 2 decimal places, e.g. 52.75. Credit account titles are automatically indented when amount is entered. Do not indent
manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit
entries.)
Date
Account Titles and Explanation
c. 31, 2026
Interest Expense
Notes Payable
Discount on Notes Payable
Cash
Debit
16,500
Credit
16,500
Prepare the journal entry at the date of purchase. (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 2 decimal
places, e.g. 52.75. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
Date
Account Titles and Explanation
c. 31, 2024
Equipment
Discount on Notes Payable
Cash
Notes Payable
Debit
115500
16,500
Credit
33,000
82,500
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