Samco signed a 9-year note payable on January 1, 2025, of $540,000. The note requires annual principal payments each December 31 of $60,000 plus interest at 6%. The entry to record the annual payment on December 31, 2026,includesA. a debit to Interest Expense for $28,800.B. a credit to Cash of $92,400.C. a debit to Interest Expense for $32,400.D. a credit to Notes Payable for $60,000.

Detailed explanation:Face value of the note $ 540,000 , interest rate 6% , issued January 1, 2025…

Answered: Samco signed a 9-year note payable on…

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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On January 1, YR01, Toyota Co. issued a two-year $1,000 note payable. The note bears interest of 7% paid yearly each December 31st. In addition, the principal amount will be paid back in two installments as follows: $400 will be paid back with the interest payment on December 31, YR01 and $600 will be paid back with the interest payment on December 31, YR02. At the date the note was issued, the market rate for similar notes payable was 6%. What is the present value of the note payable at the issue date of January 1, YR01 (assume an annual discounting period and round your final answer to the nearest penny)? a. $1,000.00 b. $1,014.77 c. $1,026.25 d. $ 1, 103.23 e. None of the answers provided are correct
On January 1, 2018, Company B borrowed 50,000 signing a 3-year installment note payable with yearly cash payments of $19,402 due each December Assuming the interest rate is 8%, what is the net note payable reported on the December 31 balance sheet after the annual payment?
How to journalize the issuance of the note on january 1 2024
Da
Flounder, Inc. issued a $115,000, 4-year, 12% note at face value to Flint Hills Bank on January 1, 2025, and received $115,000 cash. The note requires annual interest payments each December 31. Prepare Flounder's journal entries to record (a) the issuance of the note and (b) the December 31 interest payment.
At December 31, 2021, Sheridan Company had a five-month, 5%, $79,200 note receivable that was issued on October 1, 2021. Interest and principal are payable at maturity on March 1, 2022. Prepare the March 1, 2022, entry to record the receipt of cash at maturity for the note
Campus Flights takes out a bank loan in the amount of $200,500 on March 1, 2019. The terms of the loan include a repayment of principal in ten equal installments, paid annually from March 1. The annual interest rate on the loan is 8%, recognized on December 31, the fiscal year-end date. The interest recognized for the first payment date as of December 31, 2019 is $13,267. The interest recognized for the year 2020 as of the first payment date is $16,040. The principal due on the first payment date, March 1, 2020 is $186,659. 1. Compute the interest recognized for the second payment date as of December 31, 2020. _______________ 2. Compute the total interest for the year 2020. __________ IMPORTANT: Please count your months carefully as the note's "year" crosses between two fiscal years.
On January 1, Gemstone Company obtained a $165,000, 10-year, 7% installment note from Guarantee Bank. The note requires annual payments of $23,492, with the first payment occurring on the last day of the fiscal year. The first payment consists of interest of $11,550 and principal repayment of $11,942. The journal entry to record the issuance of the installment note for cash on January 1 would include a a.debit to notes payable for $165,000 b.credit to notes payable for $165,000 c.debit to interest expense for $11,550 d.credit to interest payable for $11,550
Sweet, Inc. issued a $120,000, 4-year, 8% note at face value to Flint Hills Bank on January 1, 2025, and received $120,000 cash. The note requires annual interest payments each December 31. Prepare Sweet's journal entries to record (a) the issuance of the note and (b) the December 31 interest payment. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) No. Date (a) (b) Account Titles and Explanation Debit Credit
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