To purchase inventory on January 1. 2021, Safeway signed a $600,000, three-year, noninterest-bearing note with payment in full due December 31, 2023. Safeway typically borrows at an 8% interest rate but will only have to pay $600,000 at the maturity of the note. Safeway's journal entry on January 1. 2021 to record the transaction would include: Multiple Choice a debit to Discount on notes payable for $123,701. a debit to Inventory for $600,000. a credit to Notes payable or $476,299. a debit to Notes payable for $600,000.

To purchase inventory on January 1. 2021, Safeway signed a $600,000, three-year, noninterest-bearing note with payment in full due December 31, 2023. Safeway typically borrows at an 8% interest rate but will only have to pay $600,000 at the maturity of the note. Safeway's journal entry on January 1. 2021 to record the transaction would include: Multiple Choice a debit to Discount on notes payable for $123,701. a debit to Inventory for $600,000. a credit to Notes payable or $476,299. a debit to Notes payable for $600,000.

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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