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bosey
Jun 6, 2006, 07:44 AM
Original Journal Entry: Negotiated Bank loan on September 12, in the amount of $20,000. Prepare a journal entry to issue a 60-day, 10% note to the bank for that amount. What would be the interest due on note?

Adjusting Entry for September 30th - Accrue interest on note payable ($20,000) use a 360-day year). What would be the interest to record under adjustments for month ending September 30th.

Thank you in advance for you assistance.

CaptainForest
Jun 6, 2006, 10:49 PM
Sept. 12
Dr. Cash 20,000
Cr. Notes Payable 20,000

Sept. 30
Dr. Int Expense 100
Cr. Int Payable 100
20,000 x [.1 x 60/360] x 18/60