ashley_robertson
Dec 13, 2007, 03:55 PM
Apr. 20
Purchased $40,250 of merchandise on credit from Locust, terms are 1/10, n/30. Tyrell uses the perpetual inventory system.
May 19
Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 10% annual interest along with paying $5,250 in cash.
July 8
Borrowed $80,000 cash from National Bank by signing a 120-day, 9% interest-bearing note with a face value of $80,000.
Aug.17
Paid the amount due on the note to Locust at the maturity date.
Nov. 15
Paid the amount due on the note to National Bank at the maturity date.
Nov. 28
Borrowed $42,000 cash from Fargo Bank by signing a 60-day, 8% interest-bearing note with a face value of $42,000.
Dec. 31
Recorded an adjusting entry for accrued interest on the note to Fargo Bank.
2008
Jan. 27 Paid the amount due on the note to Fargo Bank at the maturity date.
A. Determine the interest due at maturity for each of the three notes described. (Assume a 360-day year. Omit the "$" sign in your response.)
B. Determine the interest expense to be recorded in the adjusting entry at the end of 2007. (Omit the "$" sign in your response.)
C. Determine the interest expense to be recorded in 2008.(Fargo note)
I dont know how to do A, B, and C! also i need to know how to journalize August 17th's transaction!!!
:confused: :mad: :confused: :mad: :confused:
Purchased $40,250 of merchandise on credit from Locust, terms are 1/10, n/30. Tyrell uses the perpetual inventory system.
May 19
Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 10% annual interest along with paying $5,250 in cash.
July 8
Borrowed $80,000 cash from National Bank by signing a 120-day, 9% interest-bearing note with a face value of $80,000.
Aug.17
Paid the amount due on the note to Locust at the maturity date.
Nov. 15
Paid the amount due on the note to National Bank at the maturity date.
Nov. 28
Borrowed $42,000 cash from Fargo Bank by signing a 60-day, 8% interest-bearing note with a face value of $42,000.
Dec. 31
Recorded an adjusting entry for accrued interest on the note to Fargo Bank.
2008
Jan. 27 Paid the amount due on the note to Fargo Bank at the maturity date.
A. Determine the interest due at maturity for each of the three notes described. (Assume a 360-day year. Omit the "$" sign in your response.)
B. Determine the interest expense to be recorded in the adjusting entry at the end of 2007. (Omit the "$" sign in your response.)
C. Determine the interest expense to be recorded in 2008.(Fargo note)
I dont know how to do A, B, and C! also i need to know how to journalize August 17th's transaction!!!
:confused: :mad: :confused: :mad: :confused: